# Petition — PACIFIC NORTHWEST BUILDERS & CONTRACTORS, INC. v. NLR BOARD (Nos. 80-1808, 80-1798, 81-91)

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition
- **Published:** January 1, 1981

## Text

Office Supreme Court, U.S.
~~ g0-1808 : FILED
APR 29 1981

ALEXANDER L. STEVAS,
CLERK

NO.

IN THE SUPREME COURT OF THE UNITED STATES
OCTOBER TERM, 1980

PACIFIC NORTHWEST CHAPTER OF THE
ASSOCIATED BUILDERS & CONTRACTORS, INC.
PETITIONER
Vv.

NATIONAL LABOR RELATIONS BOARD
RESPONDENT

PETITION FOR WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT

Thomas M. Triplett

SCHWABE, WILLIAMSON, WYATT,
MOORE & ROBERTS

1200 Standard Plaza

Portland, Oregon 97204

Telephone: (503) 222-9981

Counsel of Record

QUESTIONS PRESENTED FOR REVIEW

a Whether the United States
Court of Appeals for the Ninth Circuit
misinterpreted this Court's decision in

Connell Construction Co., Inc. v. Plumbers

and Steamfitters Local Union No. 100, 421

U.S. 616 (1975) by concluding that it
authorized imposition of top-down
organizing restraints upon third parties
whenever the restraints are imposed in the
context of a collective bargaining
relationship.

2. Whether the United States
Court of Appeals for the Ninth Circuit
erred in holding that the construction
industry proviso to 8(e) immunizes all
subcontracting restraints imposed in the
context of a collective bargaining
relationship.

3. Whether Congress intended to

confine the scope of the construction

,

industry proviso of 8(e) to those
circumstances where there was potential for
job-site friction between union and
non-union workers.

4. Whether the Ninth Circuit
misinterpreted this Court's holding in

National Woodwork Manufacturers Association

v. NLRB, 386 U.S. 612 (1967) by
promulgating a mixed motives test.

5. Whether the Ninth Circuit
should reconsider its holding in National

Woodwork Manufacturers Association v. NLRB,

386 U.S. 612 (1967) which held that a
primary-secondary litmus test was to be
employed to determine the lawfulness of a
subcontract clause.

6. Whether 8(b)(7)(C) may be
applied to prohibit organizational or
recognitional picketing solely where a 9(a)
election could be conducted.

7. Whether the United States
Court of Appeals for the Ninth Circuit

erred in holding that an otherwise lawful
subcontracting clause may be forcefully
imposed through economic action upon an

employer.

LIST OF PARTIES
PACIFIC NORTHWEST CHAPTER OF THE
ASSOCIATED BUILDERS & CONTRACTORS, INC.

NATIONAL LABOR RELATIONS BOARD

OREGON-COLUMBIA CHAPTER, THE ASSOCIATED
GENERAL CONTRACTORS OF AMERICA, INC.

INTERNATIONAL UNION OF OPERATING ENGINEERS
LOCAL NO. 701

WOELKE & ROMERO FRAMING, INC.

CARPENTERS LOCAL NO. 944, UNITED BROTHERHOOD
OF CARPENTERS & JOINERS OF AMERICA, AFL-CIO

CARPENTERS LOCAL NO. 235, UNITED BROTHERHOOD
OF CARPENTERS & JOINERS OF AMERICA, AFL-CIO

i
TABLE OF CONTENTS

Questions Presented for Review .......
Se OCCA nie ek Giese 8 8 hele o 40k wren
AT CR as eS a eat we o's omens
COAL OM BOLOW...o i SME Raise codec cccceue
BO 1 Rg ECOL SS ais a ee
Pee PEeen GEANWUREIOINEE so wre'd S00 0.0 eb oe 0b. 08
Beatement Of THO CASS so. occ ceccc cesar
A. Procedural Background ......
B. I icte.o Oh Osh e 6 ba 6 Meskee ss
Reasons for Granting the Writ ........
A. Introductory Statement .....
B. The Court of Appeals
decision conflicts with
this Court's Connell
GERD 5 Sig:hsue 0030's 0 0.6 be awrs
C. This case presents a
estion of national
mportance which has not
been but should be
D7 SS SI RSIS ee ;
D. The decision of the Court
of Appeals conflicts with
this Court's decision ......

Conclusion ........ a Mame og” Sg) rae a

i
st)
vu nv Nyy FDO WW Pe KF {10

ii

INDEX OF AUTHORITIES

Page

Cases
Carpenters Local No. 944, United

- Brotherhood of Carpenters and

Joiners of America, AFL-CIO,

and Carpenters Local No. 235,

United Brotherhood of Carpenters

and Joiners of Amerca, AFL-CIO 9,

(Woelke & Romero Framing, Inc.), 10,

239 NLRB No. 40 (1978) .......... 1l
Colorado Building & Construction

Trades Council (Utilities Ser-

vices Engineering, Inc.), 239

NLRB No. 41 (1978) .......2eeeee. 9
Connell Construction Co., Inc. v. 1,

Plumbers and Steamfitters Local 17, 18,

Union No. 100, 421 U.S. 616 20, 21,

ES re Ry ae eee Sy |
Los Angeles Building and Construction

Trades Council and Local Union

No. 1497, United Brotherhood of

Carpenters & Joiners of America

(Donald Schriver, Inc. and

Sullivan-Kelly & Associates),

239 NLRB No. 42 (1978) .......... 94° 27

NLRB v. National Maritime Union, 486
F.2d 907 (2nd Cir. 1973) cert.
den. 416 U.S. 970 (1974) ........ 28

National Woodwork Manufacturers 2,
Association v. NLRB, 386 U.S. 27,
DAS OTE UMass 0 86 acee 4a Oe Se ike 28

iii

Statutes

Bese eGs 6S BSL OC SOG Weve cccccccvce. f
29.U.8.C. § 157 ...ce0c6 7e 17, 19, 20, 26
29 U.S.C. § 158 (a) cocccccccccccveeee 7
29 U.S.C. § 158 (b) cocccccccccccvceee 7
29 U.S.C. § 158 (b) (7) (C) .-ee--- 2 ,22
29 U.S.C. § 158 (e) ... 1, 2, 7, 8, 9, ll

17 ,18, 21, 22, °27
29 U.S.C. § 158 (£) ccccceecsccceee 7, 17
29 U.S.C. § 159 (A) wecccccceeee 2, FV, 17
29 U.S.C. § 1254 (1) ceeeceeeeneeeeeeee 7
Gl Stat 136 .cicccccccseccccccccccsccces J
Va OURS SIO ccc ccce wc cc cece aseeceecvccs 7
92 Stat 1629, 1632 w.cccccccvcccccceee Il
Public Law 95-486 ...ccccccccccccccece Ll

Rules

Rule 25, Rules of the Supreme Court
of the United States ............ ll

Fed. R. App. P. 35 (A) eeeeeeereeeeeeee 24

iv
APPENDICES
Page
Appendix A

Opinion, United States Court of
Appeals for the Ninth Circuit ...A-l

Appendix B

Decision, United States Court of
Appeals for the Ninth Circuit ...A-112

Appendix C

Decision and Order, United States

of America Before the National

Labor Relations Board ........... A7147
Appendix D

Statutory Provisions ....... POY

NO.

IN THE SUPREME COURT OF THE UNITED STATES
OCTOBER TERM, 1980

PACIFIC NORTHWEST CHAPTER OF THE
ASSOCIATED BUILDERS & CONTRACTORS, INC.
PETITIONER
Vv.

NATIONAL LABOR RELAT: ONS BOARD
RESPONDENT

PETITION FOR WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT

Petitioner respectfully prays
that a Writ of Certiorari issue to review
the judgment of the United States Court of
Appeals for the Ninth Circuit, denying

petitioner's petition to review an order of

the National Labor Relations Board.

OPINIONS BELOW

Only the slip opinion of the
limited en banc panel of the Court of
Appeals for the Ninth Circuit has been
published. (Pet. App. A, pp. Al - A111).
The opinion of the panel of the Court of
Appeals for the Ninth Circuit is reported
at 609 F.2d. 1341 (1979) (Pet. App. B, pp.
A112 - A 146). The decision and order of
the National Labor Relations Board is
reported at 239 NLRB No. 43 (Pet. App. C.
pp. A-146 - A-186).

JURISDICTION

The judgment of the Court of
Appeals for the Ninth Circuit was entered

and filed on the 17th day of April, 1981.
The jurisdiction of this Court is invoked

under 28 USCA 1254 (1).

STATUTES INVOLVED

The relevant provisions of
Sections 7, 8(a), 8(b), 8(e), 8(f) and
9(a) of the National Labor Relations Act,
as amended (61 Stat, 136, 73 Stat, 519, 29
USC §§ 151 et seq) are set forth in
Appendix D. (Pet. App. D, pp. A-183
- A-186).

STATEMENT OF THE CASE

A. Procedural Background.

The Pacific Northwest Chapter of
the Associated Builders & Contractors, Inc.
(herein referred to as "Petitioner") filed
charges on April 26, 1977, against the

International Union of Operating Engineers,

Local Number 71 (herein referred to as
"Engineers"), and the Oregon-Columbia
Chapter, The Associated General Contractors
of America, Inc., (herein referred to as
"“AGC"). The charges alleged that the
“Engineers and AGC entered into an agreement
containing a clause which prohibited
subcontracting to all non-signatory
employers and that such clause violated
Section 8(e) of the National Labor
Relations Act. General Counsel's Office
issued a complaint; the parties stipulated
to the facts; and the matter was
transmitted directly to the Board for
decision.

Amicus curiae briefs were filed

with the NLRB by the American Federation of
Labor and Congress of Industrial
Organizations, the Building & Construction
Trade Department, AFL-CIO, and the Chamber
of Commerce of the United States of
America. The NLRB consolidated three other

cases arising in other parts of the
country? and heard an "unprecedented" six

hours 3

of oral arguments.
On November 13, 1978, the NLRB
rendered its decision and order in this and
the related cases. It held that
subcontracting clauses were immunized from
8(e) scrutiny by reason of the construction

industry proviso. It further held that

1colorado Building & Construction Trades
Council (Utilities Services Engineering, Inc.), 239
NIRB No. 41 (1978); Los Angeles Building and
Construction Trades Council and Local Union | No.

1497, United Brotherhood of Carpenters & Joiners of
America (Donald Schriver, “Inc. and Sullivan-Kelly &
Associates), 239 NLRB No. 42 (1978); Carpenters
Local No. 42 (1978); Carpenters Local No. 944,
United “Brotherhood of Carpenters and Joiners o of
America, AFL--CI0; and Carpenters Local No. 235,
United Brotherhood of Carpenters and Joiners “of
America, AFL--CIO (Woelke & Romero Framing, Inc.),
239 NLRB No. GO (1978).

2

1978 BNA Labor Relations Reporter Yearbook.

Spermission to present oral argumenc, as
amicus curiae, was granted to the Chamber of
Commerce of the United States, the American
Federation of Labor and Congress of Industrial
Organizations, the Building & Construction Trades
Councl, AFL-CIO, and the Laborers International
Union of North America, AF1-CIO.

10

such provisions may not be enforced through
self help.

Petitioner filed its petition
with the United States Court of Appeals for
the Ninth Circuit (herein "Court of
Appeals") for review of this decision and
order as did AGC and the Engineers and the
Board cross-petitioned for enforcement.

The Court of Appeals
consolidated, for purposes of oral argument
and decision, the proceeding brought by the
petitioner herein with Carpenters Local

No. 944, United Brotherhood of Carpenters

and Joiners of America, AFL-CIO; and

Carpenters Local No. 235, United
Brotherhood of Carpenters and Joiners of
America, AFL-CIO (Woelke & Romero Framing,

11

Inc.), 239 NLRB No. 40 (1978).* A
three-judge panel of the Court on
December 26, 1978, held that the
subcontracting clauses were not protected
by the construction industry proviso
to 8(e) and were therefore unlawful.
Thereafter, the NLRB and the
Engineers petitioned for rehearing en banc.
The Court granted this motion and ordered
rehearing before a limited en banc panel as
provided by Public Law 95-486, 92 Stat.
1629, 1632 and Rule 25 of the Court.
On April 17, 1981 the Court of

Appeals rendered its opinion and entered

4the Court granted motions on behalf of the
Chamber of Commerce of the United States of
America, the Air Conditioning and Refrigeration
Institute, Air Movement and Control Association,
American Boiler Manufacturers Association, American
Consulting Engineers Council, Architectural
Woodwork Institute, National Soceity of
Professional Engineers, National Woodwork
Manufacturers Association, Inc., and of the
Associated General Contractors of America, Inc. to
file briefs as amicus curiae.

12

judgment affirming the decision and order

of the NLRB.
B. Facts.
Preliminary Remarks.

The parties filed a stipulation
of facts with the NLRB. As will subse-
quently appear, it is the effect to be
given to these facts which raises the
issues presented here.

The Parties.

AGC is an association of
employers engaged in all types of
construction in the states of Oregon and
five counties of southwest Washington.
(R. 28). The employer members delegated
their collective bargaining authority to
AGC for the purpose, inter alia, of
negotiating and entering into collective
bargaining contracts on behalf of its
employer members. AGC has approximately
200 member contractors.

13

Engineers are a labor
organization which represent individuals in
the construction industry who perform work
contractually defined under various labor
agreements, including that with AGC. Its
jurisdiction is generously defined by the
collective bargaining agreement as follows:

“assembly and/or

disassembly in the

nog of all equipment

within the jurisdiction of

the union, regardless of

its use or whether such

equipment is mechanically,

electrically,

electronically,

hydraulically,

automatically or remotely

controlled."

It extends to all heavy highway work,
building work and also to off-site work at
quarries, asphalt plants, etc.

Petitioner is an organization of
contractors whose members are both union
and non-union. One of its organizational
purposes is to extend the concept of merit
shop, i.e., the opportunity of union and

non-union contractors to bid upon and work

14

on jobs based exclusively upon price,
quality and service and without discrimina-
tion of any sort.

The Contract.

The Collective Bargaining Agree-
ment contains the following provisions:
"ARTICLE VIII
Subcontractors and Other Employers

Section 1. Employers shall
not contract any work

covered by this Agreement to
be done at the site of the
construction, alteration,
painting or repair of a
building, structure, or other
work to any person, firm or
company who does not have an
existing labor agreement with
the Union covering such work.

Wk kk KK K

ARTICLE IX
Settlement of Disputes

Section 5. Should the
parties involved fail to
comply with the findings
within five (5) days after
such written notification by
either party or fail to
comply with any of the
provisions and/or time limits
established in this Article,

15

unless mutually agreed to extend such
limits, then all means of arbitration
shall be considered exhausted.

Either party may take such
action as they deem necessary
to enforce the findings
and/or time limits and they
shall not be considered in
violation of any part of this
Agreement." (Tr. 29).

A subcontractor was deemed to
refer:

"x * * to any person, firm or
corporation who agrees with,
orally or in writing, to
perform or who, in fact,
performs for, or on behalf

of, an Employer any part or

portion of work covered by

this Agreement." (R. 45).

The agreement required AGC, and
all other signatory employers, to
acknowledge Engineers as the sole and
exclusive representative of employees
covered thereunder; and compelled all
employees to become members of the union
not later than the eighth day following
commencement of employment or be terminated

(R. 48).

16

REASONS FOR GRANTING THE WRIT

A. Introductory Statement.

The Court of Appeals held that it
was proper for an association of
general contractors and a construction
industry union to enter into a collective
bargaining agreement which prohibits
signatory general contractors from doing

5 union

business with non-union and wrong
contractors. It concluded that such
agreements are lawful so long as there is a
collective bargaining relation between the
signatory employer and the union.

The construction industry is sui
generous. Congress recognized its
differences in a variety of statutory

fashions. It was not Congress’ intent,

however, to give any greater shelter from

SEmployers-who have been required to enter
into a collective bargaining agreement with a
different union pertaining to the particular work.

17

the prohibitions of 8(e) than those
differences required.

The effect of the decision is to
vest a brutal top-down organizational tool
in the hands of construction industry
unions. The decision will have the overt
and obvious effect of depriving employees
of their rights under Section 7 to
“refrain” from collective bargaining
activities; constitute a significant
impediment to exercise of their electoral
rights as granted under Section 9;
frustrate the congressional intent in
enactment of 8(f); add additional fuel to
the already spiraling inflationary cost of
construction work; and emasculate this

Court's decision in Connell Construction

Co., Inc. v. Plumbers and Steamfitters

Local Union No. 100, 421 U.S. 616 (1975)
(herein “"Connell").
The difference between the

construction industry and industries

18

generally do not suggest, let alone compel,
the decision reached by the Court of
Appeals. As will be demonstrated
hereinafter the Court of Appeals should
have adopted the principles enunciated by
this Court in Connell.

B. The Court of Appeals Decision

Conflicts with this Court's.

Connell Decision.

In Connell Construction Co., Inc.

v. Plumbers and Steamfitters Local Union

No. 100, 421 U.S. 616 (1975) hereinafter
referred to as "Connell", this Court
reviewed the scope of the Section 8(e)
construction industry proviso. In that
case the union sought to impose a restraint
upon the right of the employer to freely
contract with whom it chose despite the
fact that the employer neither employed any
employees and the union expressly

disclaimed any representational interest.

19

This Court properly recognized that
the language of the proviso was not to be read
literally and therefore made a meticulous
examination of the legislative history. It
held that subcontracting restraints, of any
nature, are lawful only when necessary to
carry out the congressional purpose expresed
in the proviso. «

The Court concluded that there
were two critical and sometimes competing
factors that must be juxtapositioned and
balanced in order to ascertain the scope of
the proviso.

First, the Court considered the
important Section 7 rights of employees to
self organization and collective bargaining
and their correlative right "to refrain from
any and all of such activities." It held
that there was an overriding congressional
purpose to interdict top-down organizing
techniques of labor organizations which

20

frustrate employees in their effort to
exercise their statutory right to "refrain."

Second, the Court found that
Congress recognized that the construction
industry is different than industries
generally. It pinpointed the fact that
emplovees of different employers are thrust
together on common jobsites for short periods
of time. Congress and this Court hypothesized
that unless a contractor were permitted to
voluntarily restrain, through agreement with
the Union, subcontracting to non-union
contractors, that the potential for jobsite
friction could cripple the industry. It was
solely this concern, that of potential jobsite
friction, upon which Congress focused.

In Connell, this Court struck the
balance against the exercise of Section 7
rights when jobsite friction was possible.
When such friction was not possible, the
balance necessarily fell sharply on the

other side. In consequence, the Court

21

concluded that any subcontracting clause was
broader than the exigency its statutory prop
prop would support must be found to violate
8(e).

The underlying principles of
Connell have been violated by the Court of
Appeals decision. The subcontracting
clause here applies without regard to the
purposes underlying the proviso, i.e. there
are innumerable circumstances when jobsite
friction could not occur and yet the clause
would be held to apply.

The Ninth Circuit sought to prop
its departure from Connell upon a

6

nonexistent foundation. It was compelled

to recognize that the top-down organizing

Sone Ninth Circuit was concerned that it was

departing the Connell guidelines. This concern is
sprinkled throughout its opinion. For example, it
states:

"We can see that the language of the
Connell opinion dealing with congressional
antagonism to top-down organizing may well
lean in a direction contrary to our own views."

22

through a subcontracting restraint was condemnec
by this Court in the absence of a collective
bargaining relationship. It concluded that the
protection of 8(e) was granted in such circum-
stances because the employer had no 8(b)(7)(C)
protection. The Court of Appeals hypothesized
that since an employer who had a collective
bargaining relationship is entitled to 8(b)(7)(C
protection, neither Congress nor this Court
intended 8(e) to furnish additional protection.
The problem with all of this finespun rhetoric,
among others, is that no authority was cited fo1
the novel distinction because indeed the law is

to the contrary.’

"hs the General Counsel stated:

“However, where a construction industry
employer has no unit employees or less than a
representative complement, and a union pickets
to obtain an 8 (f) contract, it is our view
that since a question concerning representation
could not be held, such picketing would be
violative of 8 (b) (7) (C) from the first day.
Memorandum 79 - 32, p. 9."

23

The Court of Appeals has failed to
apply the principles enunciated by this Court
in the Connell decision. The four dissentors
succinctly recognized this departure.

C. This Case Presents a Question of

National Importance Which Has not Been

But Should be Decided.

Assuming, arguendo, that the Connell
decision must be confined to its facts and
the principles enunciated therein are concluded
to be of uncertain application here, then there
is an unsettled question of national significance
which should be settled here.

Throughout the history of these
proceedings, the primary issue, i.e., whether the
Connell ruling applies in the context of a
collective bargaining relation, has been treated
as one of overriding importance in the construction

industry.

24

The NLRB recognized its
importance. It was for this reason that it
consolidated four cases from across the
country; granted an unprecedented six hours
of oral argument; granted applications from
numerous parties to present amicus briefs
and oral argument.

The Court of Appeals also recognized
the importance of the issues tendered.
First, it allowed a series of amicus briefs
to be filed. Second, the Court of Appeals
granted rehearing and;

"Such a hearing or rehearing is

not favored and ordinarily will

not be ordered except * * *

(2) when the proceeding involves

a question of exceptional

importance." Rule 35(A) FRAP

Third, the Court of Appeals, in its
opinion, acknowledged:

"These cases raise important

questions concerning the scope of

8 (e) of the National Labor
Relations Act. * * *"p., 1

25

The perception of both the NLRB
and the Court of Appeals as to the
significance of the issues presented is
accurate. The lawfulness of restraints on
subcontracting know no geographic
boundaries. If the decision is permitted
to stand, it is predictable that this type
of clause will immediately become a
bargaining demand in each region where a
similar clause is not already in place.
Refusal on the part of a contractor to
agree may create national labor unrest.

An almost certain effect of this
decision will be to immunize such
provisions from antitrust scrutiny; to
present the already overburdened consumer
of construc-tion products, the public, with
the reality of rapidly escalating and
spiraling cost to purchase a home.

The decision will also effect the
rights of many nonunion employees. They

will be faced with an inexorable top-down

26

organizing inducement. Work opportunities
will be forfeited unless Section 7 rights
are sacrificed.

The nonunion contractor will
suffer. If it succumbs to pressure which
this clause presents, it will necessarily
infringe upon employee rights. If it fails
to succumb, he may find himself without
work.

Even the union contractor
suffers. Simple ecnomics dictates that
elimination of competition will produce
higher cost. Members of the public, and
particularly the individual who desires to
purchase a home, may have to forego
purchase because of cost. Thus the union
contractor's work opportunities will
themselves become more limited and, as
perversity would have it, the union
employee's work opportunities will also
dwindle.

27

In the six years since the Connell
decision was rendered the scope of the opinion
has been debated frequently. In addition to
this case, and the companion Shriver-Topaz
matter which is presently pending before this
Court upon Petition for Certiorari, there are
at least five other cases pending before the
U.S. District Court for the Ninth Circuit.

Decision is needed by the
construc-tion industry on this most important
ques-tion. Collective bargaining and day-to-day
administration of collective bargaining
agreements most urgently require a bright line
or litmus test guidance for future conduct.

D. The Decision of the Court of Appeals
Conflicts with This Court's Decision.

In National Woodwork

Manufacturers Association v. NLRB, 386 U.S.
612 (1967) this Court held that 8(e) interdicts
only secondary as opposed to primary boycotts,

whether effectuated by agreement or through

28

economic action. The dissent vigorously urged
that primary as well as secondary subcontracting
restraints were unlawful.”

The Ninth Circuit appears to
reject the primary/secondary dichotomy set
forth by this Court. Its enumeration of a
mixed motive test is alien to the teachings
of National Woodwork and the consistent
line of the NLRB decision. ?°

Petitioner has previously urged that National
Woodwork Manufacturers Association v. NLRB was
roperly decided. It contends that all primary
restraints are unlawful except in the construction
industry where the restraint must be secondary to
be unlawful.

10506 NLRB v. National Maritime Union, 486

ol gg (2nd. Cir. 1973) cert. den. 416 U.S. 970
1974).

29

CONCLUSION

For the foregoing reasons, this
Petition for Writ of Certiorari should be
granted.
Respectfully submitted,

SCHWABE, WILLIAMSON, WYATT,
MOORE & ROBERTS

By:
THOMAS M. TRIPLETT
of Attorneys for
Petitioner

A-1

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

PACIFIC NORTHWEST CHAPTER)
OF THE ASOCIATED BUILDERS )
& CONTRACTORS, INC.,

Petitioner,

ee eee ee ee

NATIONAL LABOR RELATIONS
BOARD,

Respondent.

THE ASSOCIATED GENERAL
CONTRACTORS OF AMERICA,
INC.,

Petitioner,

NATIONAL LABOR RELATIONS
BOARD,

Respondent

ee er ee ee eee ee Se See See See eee See See See See Se See ee” See” See See Se Se See ee” See” Se” St” Se” Se Se

OPERATING ENGINEERS,
LOCAL NO. 701

Petitioner,

No. 78-3469

No. 78-3487

No. 78-3619

A-2

NATIONAL LABOR RELATIONS

BOARD,

Respondent
WOELKE & ROMERO FRAMING, —
INC.,

Petitioner,

NATIONAL LABOR RELATIONS
BOARD,

Respondent.

)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
CARPENTERS LOCAL NO. 944 )
AND CARPENTERS LOCAL )
NO. 235,
)

Intervenors.

NATIONAL LABOR RELATIONS —
BOARD,

-V=

)
)
)
)
CARPENTERS LOCAL NO. 944, )
UNITED BROTHERHOOD OF )
CARPENTERS & JOINERS )
OF AMERICA, AFL-CIO, and )
CARPENTERS LOCAL NO. 235,)
UNITED BROTHERHOOD OF +=)
CARPENTERS & JOINERS OF )
AMERICA, AFL-CIO,
)

)

)

Respondent.

No. 78-3468

No. 79-7011

OPINION

A-3

Petitions for Review of Orders of
the National Labor Relations Board.
Argued and submitted October 16, 1980.
BEFORE : BROWNING, Chief Judge, CHOY,
WALLACE, SNEED ANDERSON, SCHROEDER,
FLETCHER, FARRIS, NELSON, CANBY and
NORRIS, Circuit Judges
_ CANBY, Circuit Judge
These cases raise important questions
concerning the scope of § 8(e) of the
National Labor Relations ACt, 29 U.S.C.
§ 158(e), which prohibits "hot cargo"
agreements. The primary issue is whether
the construction industry proviso to
§ 8(e) renders lawful clauses in collective
bargaining contracts forbidding the
employers to subcontract work at any
construction site to a firm not having a
contract with the signatory union.
Additional issues are whether unions may
picket or strike to induce an employer to
enter these agreements and whether the
agreements, once entered, may be enforced

by picketing or strikes. We conclude that
the subcontracting clauses fall within the

A-4

construction industry proviso and
consequently do not violate § 8(e). We
also conclude that unions may picket or
' gtrike to obtain such agreements, but not
to enforce them. The orders of the
National Labor Relations Board are
accordingly enforced.

I.
Facts.

Two orders of the Board are under
review here pursuant to 29 U.S.C. § 160(e)
and (f). The first concerns a collective
bargaining agreement between Oregon-Columbia
Chapter of the Associated General Contractors
of America, Inc. (AGC) and Local 701 of the
International Union of Operating Engineers
(Engineers). AGC is an association of
some 200 employers engaged in construction
in Oregon and southwest Washington. These
employers have delegated their collective
bargaining authority to AGC. AGC and

Engineers entered into a collective bargain-

A-5

ing agreement effective from June 1, 1975,
through May 31, 1980, which contained the
following clause:

Article VIII
Subcontractors and Other Employers.

Section 1. Employers shall
not contract any work covered
by this Agreement to be done
at the site of the construction,
alteration, painting or repair
of a building, structure or
other work to any person, firm
or company who does not have
an existing labor agreement
be the Union covering such
work.

Subsequent clauses!

provide for a
grievance procedure leading to arbitration
and further provide that should the parties
fail to comply with the arbitrator's deci-
sion, then "[{eJither party may take such
action as they deem necessary to enforce

the findings. . .." The effect of the
latter provision is to permit either party
to employ self-help, such as strikes or
lockouts, that would otherwise be prohibited

by another article of the agreement.

A-6

Upon complaint by Pacific Northwest
Chapter of the Associated Builders &
Contractors, Inc., Engineers and AGC were
charged with violating § 8(e)? of the
National Labor Relations Act, which
prohibits agreements between a labor
organization and an employer in which the
employer agrees to refrain from using the
products of another employer or to cease
doing business with any other person. The
case was submitted to the Board upon
stipulated facts and the Board found that,
while the agreement fell within the
prohibition of § 8(e), it was exempted
from the coverage of that provision by the
construction industry proviso applicable
to agreements “between a labor organization
and an employer in the construction industry
relating to the contracting or subcontract-
ing of work to be done at the site of the
construction, alteration, painting, or

repair of a building, structure, or other

A-7

work. . . ." The Board also ruled that
the clause authorizing enforcement of the
subcontracting provision by self-help was
invalid. All parties petitioned for
review and the Board sought enforcement of
its order.

The second decision of the Board
concerns Woelke and Romero Framing, Inc.,
(Woelke), a framing subcontractor in the
construction industry in Southern California.
Woelke was a party to a collective bargain-
ing agreement entered on July 5, 1974, with
the United Brotherhood of Carpenters and
Joiners of America, AFL-CIO (Carpenters),

a group which included Locals Number 235
and 944 involved in this litigation. That
agreement expired on Jun 15, 1977. From
about June 3, 1977, to August 4, 1977,
Carpenters and Woelke engaged in collective
bargaining for the purpose of negotiating

a successor agreement. They broke off

negotiations when they reached an impasse

A-8

3 One such issue was

over several issues.
the union's demand for a clause in the
contract that prohibited Woelke from
subcontracting work at any construction
jobsite "except to a person, firm or
corporation, party to an appropriate,
current labor agreement with the
appropriate union, or subordinate body
signatory to this Agreement. "* In support
of Carpenters' demand for this contract
provision, Locals 235 and 944 picketed
Woelke's construction sites, causing some
work stoppages. The two locas were charged
with violation of § 8(b)(4)(i) and (ii)(A)
of the Act” for picketing to require an
employer “to enter into an agreement which
is prohibited by section 8(e)."

The case was submitted to the Board
upon stipulation and the Board found that
the proposed subcontracting agreement was
not prohibited by § 8(e) because it fell
within the construction industry proviso,

A-9

and that picketing to obtain such a clause
therefore did not violate § 8(b)(4).
Woelke petitions for review of the Board's
order, and the Board seeks enforcement. °
Both decisions of the Board were
reviewed by a panel of this court. 609
F.2d 1341 (9th Cir. 1979). On the

authority of Connell Construction Co. v.

Plumbers & Steamfitters Local Union No. 100,
421 U.S. 616 (1975), the panel held that

the subcontractor clauses were prohibited
by § 8(e) and did not fall within the
protection of the construction industry
proviso because their applicability was
not limited to jobsites where members of
the signatory union were employed at some
time during the construction project.
Having found the present clauses
unenforceable, the panel did not reach the
questions whether picketing or striking
either to obtain or enforce a lawful

subcontractor clause would violate

A-10

§ 8(e). 609 F.2d at 1351. This court
subsequently ordered rehearing before a
limited en banc panel as provided by _
Public Law 95-486, 92 Stat. 1629, 1633 and
Rule 25 of this court.

II.
Issues.

Four issues are presented for deter-
mination in these cases:

(1) are the subcontracting clauses
"secondary" and therefore within the scope
of § 8(e)?

(2) If the clauses are within the
scope of § 8(e), are they exempted from
its proscription by the construction ©
industry proviso?

(3) If the subcontracting clauses
are lawful, does it nevertheless violate
§ 8(b)(4) for a union to picket or strike
to induce an employer to agree to one?

(4) If the subcontracting clauses

are lawful, does it nevertheless violate

A-11

§ 8(b)(4) to enforce them by picketing or
strikes?

III.
Applicability of § 8(e).

The subcontractor clauses in the
present case clearly require the signatory
employer to cease or refrain from using
the products of another employer or to
cease doing business with another person.
The clauses consequently fall within the
literal language of § 8(e). In National
Woodwork Manufacturer Association v. NLRB,
386 U.S. 612 (1967), however, the Supreme
Court held that § 8(e) is not to be read

as expansively as its language seems to
indicate. The Court pointed out that the
purpose of Congress in enacting § 8(e) was
to prohibit voluntary arrangments that
reached the same result as coercive
secondary boycotts prohibited by

§ 8(b)(4)(ii)(B) of the Act. The court

therefore held that an agreement between a

A-12

union and an employer which prohibited
certain kinds of subcontracting was
permissible so long as the objective was
to perserve work traditionally performed
at the jobsite by employees of the primary
employer. Such a "work preservation"
clause was viewed as primary and therefore
did not constitute an unfair labor

practice. ’

The test whether an agreement
was primary and permissible was "whether
the agreement or its maintenance is
addressed to the labor relations of the
contracting employer vis-a-vis his own
employees." Id. at 645. An agreement was
secondary and prohibited when "the
agreements and boycotts were tactically
calculated to satisfy union objectives
elsewhere." Id. at 644.

By the National Woodwork test, union

signatory clauses such as those in issue
here are secondary in objective. They do

not seek to preserve work for the employees

A-13

of the contracting employer by limiting

the amount of subcontracting. Nor do they
seek to protect the wage and benefit
standards of those same emploiyees in

their present employment by merely

limiting subcontracting to third parties
who maintain equivalent standards. Instead,
these union signatory clauses permit unlinm-
ited subcontracting to third parties who
maintain equivalent standards. Instead,
these union signatory clauses permit unlim-
ited subcontracting so long as the subcon-
tractors have an agreement with the con-
tracting union. Such clauses are properly
viewed as secondary, for they are intended
to satisfy union objectives involving
employees and employers outside of the bar-
gaining or work unit. Griffith Co. v. NLRB,
545 F.2d 1194 (9th Cir. 1976), cert. denied,
434 U.S. 854 (1977); NLRB v. National
Maritime Union, 486 F.2d 907 (2d Cir. 1973),
cert. denied, 416 U.S. 970 (1974).

A-14

It is contended by Engineers that the
objective of preserving work within the
entire multi-employer bargaining unit of
AGC is a primary goal and that this fact
should take its subcontracting clause
outside of the scope of § 8(e). This
argument fails for two reasons. First,
the clause in question does not limit sub-
contracting to firms that are membérs of
AGC. Outsiders having an agreement with
Engineers are eligible, even though they
and their employees are wholly foreign to
the multi-employer bargaining unit. The
clause therefore is not a primary work
preservation clause. NLRB v. National

Maritime Union, 486 F.2d at 914. Second,

§ 8(e) applies in any event to an agreement
which attempts to preserve work for an entire
multi-employer unit rather than for single
employers' employees. This court dealt with
the issue in NLRB v. Joint Council of Team-

sters No. 38, 338 F.2d 23, 28 (9th Cir. 1964):

A-15

Respondents seem to argue that
{the clause] falls within the
exception to section 8(e)
because it preserves the job
opportunities of employees
within the multi-employer
bargaining unit by prohibiting
subcontracting to any employer
outside that unit. But if
this argument were accepted,
the exception to section 8(e)
would permit precisely what
the section itself was
intended to prohibit: An
agreement by an employer to
boycott another unless the
latter entered into a union
contract.

Accord, NLRB v. National Maritime Union,

supra.
The union's further contention that

work preservation for the employees of
each contractor was one of the objectives
underlying the union subcontracting
clause, does not compel us to alter our
conclusion. Regardless of the union's
other objective, if “an object of a cluase
is to aid union members generally rather
than members of the unit, the object is

secondary and unlawful." National

A-16

Maritime Union, 19€ N.L.R.B. 1100, 1101
(1972), enforced, 486 F.2d 907 (2d
Cir. 1973), cert. denied, 416 U.S. 970

(1974) (emphasis supplied).

It is true that the primary-secondary
distinction is particularly difficult to
maintain in the construction industry,
where contractors and subcontractors
assemble their work forces for specific
short-term jobs. There is a great deal of
flexibility and interchangeability of
employees between bargaining units. As a
result, a subcontractor clause may well
serve the interests of union members in
the primary bargaining unit who may later
find themselves working for a subcontractor.
While we believe that fact to be of great
significance for purposes of determining
the scope of the construction industry
proviso, we do not view it as determinative
of the initial applicability of § 8(e)

itself. See NLRB v. National Maritime

A-17

Union, supra, at 913-14. The
primary-secondary distinction between
separate employers working the same
jobsite in the construction industry has
been adhered to in the past, NLRB v.
Denver Building & Construction Trades, "341
U.S. 675 (1951), and we do not feel free

to disregard it here. Moreover, the
consequences of viewing union signatory
clauses as primary would be not only to
remove them from the scope of § 8(e) but
also to remove picketing to enforce such
agreements from the prohibition of

§ 8(b)(4)(ii)(B). For reasons stated in
Section VI of this opinion, we believe
that permitting coercive enforcement of
union signatory clauses would he contrary
to the intent of Congress.

We accordingly hold that the union
signatory clauses in these cases are
secondary and within the scope of § 8(e).
Their validity consequently depends upon

A-18

their eligibility for inclusion within the
construction industry proviso to that
section.

IV.
Scope of the Construction Industry Proviso
to § 8(e).

In order to ascertain the scope of
the construction industry proviso, it is
necessary to examine its legislative
history in the light of the practices
existing in the industry at that time and
the law then applicable. In so reviewing
the origins of the 1959 Landrum-Griffin
Act of which § 8(e) and its proviso were a
part, we recognize that our initial |
conclusions as to its meaning are subject
to any modifications or corrections that
may be compelled by a fair reading of
Connell Construction Co. v. Plumbers &
Steamfitters Local Union No. 100, 421 U.S.
616 (1975). Indeed, it is the effect of

Connell that provides the primary ground

A-19

of controversy in the present litigation.
We believe, however, that the Connell
decision is best analyzed after a review
of the state of the industry and the
legislative and administrative history of
the proviso governing it.

(A) Construction Industry Background.

The primary characteristics which
differentiate the construction industry
from most others are well stated in the
Senate Report on the 1959 amendments:

The occasional nature of the
loyment relationship makes
this industry markedly
different from manufacturing
and other are of enterprise.
An individual employee typically
works for many employers and
for none of them continuously.
Jobs are frequently of short
duration, depending upon various
stages of construction.

S. Rep. No. 187, 86th Cong., lst Sess. 27
(1959); I Legislative History of The Labor-

Management Reporting and Disclosure Act of

1959 423 (hereinafter Leg. Hist.). These

peculiarities of the construction industry

A-20

created special problems for both unions
and employers long before 1959. Unions
had to overcome difficulties of organizing
temporary workers and of maintaining wage
and benefit standards in unstable
employment conditions. Employers required
a ready source of skilled workers
available for each new job, and had to be
able to forecast labor costs accurately.
To satisfy these needs, unions and
employers hammered out a number of mutual
accommodations. One such arrangment was
the closed shop, which was prevalent in
the inustry by the 1920's.® A second was
negotiation of area-wide agreements
covering all construction work of a
certain type, with multiple contracting
employers agreeing to the standards set in

9 of necessity, these

those agreements.
contracts dealt with wages, hours and
working conditions of employees yet to be

hired for particular jobs by particular

A-21

10 A third device was the agree-

employers.
ment to restrict subcontracting in various
wasy -- to firms maintaining union standards,
or to firms that were unionized, !+ or to
firms that agreed to bind themselves to
contracts with the union signatory to the
subcontracting clause.
Some of these devices were not
necessarily consistent with the
organizational scheme of the National
Labor Relations Act in its original form.
The Act initially cuased no disruption in
the pattern of collective bargaining in
the construction industry, however,
because the National Labor Relations Board
declined to exercise jurisdiction over
that industry. 2° The Taft-Hartley
Amendments to the Act, passed in 1947, led
to a reversal of the Board's position.
Those amendments prohibited striking or

picketing to coerce an employer to refrain

from dealing in the products of any other

A=-22

employer or to cease to do business with
any other person. § 8(b)(4)(A).24
Subsequent to the amendments, the Board's
General Counsel determined that the
construction industry would be regulated
by the Board. +>

One effect of applying the amended
Act to the construction industry was the
invalidation of collective bargaining agree-
ments entered before any employees were

hired on the job. Guy F. Atkinson Co. and

J.A.Jones Construction Co., 90 N.L.R.B.

143 (1950), enforcement denied on other

grounds, 195 F.2d 141 (9th Cir. 1952).
The amended Act was also applied to
prohibit a construction union from
picketing a jobsite in order to force the
general contractor with whom it had a
collective bargaining agreement to cease
doing business with a particular
subcontractor on the job whose employees

were non-union. NLRB v. Denver Building &

A=-23

Construction Trades Council, 341 U.S. 675

(1951). The picketing was found to
violate § 8(b)(4)(A)'s prohibition of
coercive secondary boycotts.

These applications of the amended
National Labor Relations Act to the
practices that there was agitation for
modification of the Act, particularly in
regard to prehire practices and secondary
activity. In 1954, President Eisenhower
called for amendments to permit prehire
agreements and to shorten to 7 days the
time by which a nonunion worker could be
required to join a union under a union-shop
agreement. 100 Cong. Rec. 111, [1954]
U.S. Code Cong. & Admin. News 1532. Again
in 1959, when calling for amendments to
tighten the prohibition against secondary
boycotts, the President added that
provisions were needed "to make clear that
secondary activity is permitted .

under certain circumstances, against

A-24

secondary employers engaged in work at a
common construction site with the primary
employer." S. Doc. 19, 86th Cong., lst
Sess.; 105 Cong. Rec. 1297; I Leg. Hist.
82.

Accommodation to the special
conditions of the construction industry
was consequently an important
consideration that found expression in the
1959 amendments to the Act. Those amendments,
however, also embodied another major goal
of Congress at the time--that of limiting
"hot cargo" agreements.

In June 1958, the Supreme Court had
decided Local 1976, United Brotherhood of
Carpenters v. NLRB, (Sand Door), 357 U.S.
93. Sand Door stated that a union did not
violate § 8(b)(4)(A) by securing the

voluntary participation of an employer in
a boycott of another employer's product.
Although the Court said it found no

occasion to determine the legality of “hot

A-25

cargo" clauses (by which an employer
agreed to boycott nonunion firms) as such,

id. at 107, Sand Door was widely

interpreted as permitting them. The
decision was seen as creating a loophole
in the Act, and it contributed heavily to
the move toward amending the secondary
boycott provision of the Act.

(B) The Landrum-Griffin Amendments and § 8(e).

The 1959 revisions of the Act accomp-
lished the congressional purposes in various
ways. The clearest accomodation to the
peculiar conditions of the construction
industry was found in § g(£), +6 which
authorized unions and employers in that
industry to enter prehire agreements fixing
terms and conditions of employment of
workers yet to be hired. This provision
amounts amounts to an exception to
§§ 8(a)(1), (2) and 8(b)(1)(A), which make
it an unfair labor practice for both the

employer and the union to enter a collective

A-26

bargaining agreement before the union
represents a majority of employees in the

unit. International Ladies Garment

Workers Union v. NLRB, 366 U.S. 731

(1961); see NLRB v. International

Association of Bridge, Structural &

Ornamental Iron Workers, 434 U.S. 335,
344-45 (1978). Section 8(f) also

shortened to 7 days the period of nonunion
workers to join the union undre a
union-shop agreement.

Conflicting policies were reflected
Clearly in the passage of § 8(e), which
was intended to narrow or close the
loophole for "hot cargo" agreements

created by the Sand Door decision. The

Senate bill prohibited such agreements
only in the trucking industry, 27 while the
House bill outlawed them everywhere. ?®
The Conference Committee adopted the House
version, but added the provisos creating

exceptions for the garment and construction

A-27

19

industries. The garment industry excep-

tion was unlimited as to time and place, 2°
while the construction industry proviso
excepted agreements "relating to the
conrracting or subcontracting of work to
be done at the site of the construction,
alteration, painting or repair of a
building, structure or other work..... "
It is the nature and meaning of the
construction industry proviso's restriction
to the jobsite that gives rise to the pre-
sent controversy. The contractors assert
that the proviso is intended to authorize
subcontracting clauses in collective
bargaining agreements only when union
workers are present at the jobsite, so
that the presence of nonunion workers
there might lead to friction. The unions
claim that the intent was to authorize
subcontracting clauses whether or not
union workers were at the jobsite, so long

as the clauses refer to work to be performed

A-28

at the construction site. Although the
matter is not free from doubt, we blieve
that the legislative history favors the
latter view.

(C) Legislative Discussion of the Construc-

tion Industry Proviso.

_ The legislative history regarding the
construction industry proviso is much less
exhaustive than that surrounding the
garment industry proviso, 2+ but there are
nevertheless indications of congressional
intent in the records. Senator Kennedy,
the chairman of the Conference Committee,
said of the two provisos, that "[(b]oth
changes were necessary to avoid serious
damage to the pattern of collective
bargaining in these industries." 105
Cong. Rec. 17899; II Leg. Histo. 1432.
Unlike the garment industry, the
construction industry was not exempted
from the provisions of § 8(b)(4) that

prohibited striking or picketing to coerce

A-29

a secondary boycott; it was merely exempted
from § 8(e)'s prohibition of agreements
between a union and an employer by which
the employer would boycott others. The
Conference Committee stated its intent in
regard to the proviso as follows:

The committee of conference does
not intend that this proviso
should be construed so as to
change the present state of the
law with respect to the validity
of this specific type of
agreement relating to work to be
done at the site of the
construction project or to remove
the limitations which the present
law imposes with respect to such
agreements. .. . To the extent

at such agreements are legal
today under section 8(b)(4)

. ., the proviso would prevent
such legality from being affected
by section 8(e).

H.R. Rep. No. 1147, 86th Cong., lst Sess.
39; I Leg. Hist. 943. Senator Kennedy
analyzed the proposed § 8(e) as follows:

The first proviso under new
§ 8(e) of the National Labor
RElations Act is intended to
“pagpehes the present state of the
aw with respect to picketing at
the site of a construction
project and with respect to the
validity of agreements relating

A-30

to the contracting of work to be
done at the site of a
construction project.

Agreements by which a contractor

in the construction indust rom-
ises not to subcontract ark on a
construction site to a nonunion con-
tractor appear to be legal today.
They will not be unlawful under

$ S(e). ...

It should be particularly noted
that the proviso relates only to
the "contracting or
subcontracting of work to be done
at the site of the construction."
The proviso does not cover
boycotts of goods manufactured in
an industrial plant for
installation at the jobsite, or
cupercere who do not work at the
jobsite.

105 Cong. Rec. 17900; II Leg. Hist. at 1433
(emphasis supplied).

As Senator Kennedy made clear, unions
continued to be forbidden to picket or
strike at a construction site for secondary

objectives, which meant that the holding of

Denver Building Trades, supra, was left in
effect. On the other hand, the Conference

A-31

Report and Senator Kennedy made it equally
clear that unions and employers could enter
subcontracting agreements as permitted by
law prior to the enactment of the new

§ 8(e).

It seems more likely than not that the
"present law" referred to by the Conference
Committee did not restrict the agreements
that Senator Kennedy said “appear to be
legal" to jobsites where union workers were

present. The Sand Door decision, supra,

which supplied much of the impetus for

§ 8(e), had legitimized secondary boycotts

the objectives of which clearly went beyond
the mere avoidance of shoulder-to-shoulder

friction between workers. It is true that

the construction industry proviso narrowed

the geographical scope of the Sand Door

rule by introducing the jobsite limitation,
but we do not interpret the words of the

proviso as indicating an intent to narrow

A-32

the substantive scope of the Sand Door rule

on the jobsite.

It should be noted that shortly before
enactment of the proviso, the District of
Columbia Circuit had upheld a subcontractor
agreement the terms of which were as broad
as those presently in issue. Operating
Engineers Local Union No.3 v. NLRB, 266

. F.2d 905 (D.C. Cir.), cert. denied sub nom.
St. Maurice v. NLRB, 361 U.S. 834 (1959).

While that case dealt with an interunion
dispute, the terms of the secondary
agreement were not restricted to that or
any other situation of jobsite conflict.
In upholding the agreement, the Court
referred to the Board's reasoning “that the
preclusion of future work to a prospective
subcontractor in the circumstances did not
justify the Board in holding that the
rights of unidentified employees of such
prospective employer were adversely
affécted." 266 F.2d at 908.

A-33

Moreover, a survey of major labor
contracts in existence in 1959 revealed
that more than 50 of them contained clauses
restricting subcontracting to firms
conplying with the terms of the prime
employer's agreement. Lunden,
Subcontracting Clauses in Major Contracts,
84 Monthly Labor Review 579 (Part I), 715
(Part II) at 715 (1961). While the survey

does not adequately differentiate between
union signatory clauses and union standards
clauses, it is nevertheless clear that
numbers of broad subcontractor agreements
were in existence.” The survey cafivasses
various limitations appearing in
subcontracting clauses in the construction
industry, but makes no mention of any
restrictions to the jobsite or references
to the problem of friction between union
and nonunion workers there. Id. at 715-16.
That there may not have been a consistent

pattern of subcontractor agreements of the

A-34

type in issue here is not crucial. What
does emerge from the contemporaneous scene
is that some such agreements existed and
were legal and that Congress did not appear
to intend a change in that condition.

Vv.

(A) The Connell Decision.

It was against this industrial and
legislative background that the Supreme

Court decided Connell Construction Co. v.

Plumbers & Steamfitters Local Union No.
100, 421 U.S. 616 (1975). Connell was an

antitrust suit brought by a general
contractor against a union that was
picketing in order to coerce the contractor
to enter an agreement to deal only with
subcontractors having a collective
bargaining agreement with the union. The
union expressly disclaimed any interest in
representing the general contractor's
employees. the picketing was successful

and the contractor sought to annul the

A-35

ensuing agreement on the crounds that it

24 One of the

violated the antitrust laws.
defenses raised by the union was that the
agreement could not be a violation of the
antitrust alws because it was authorized by
the proviso to § 8(e) of the National Labor
Relations Act. The Supreme Court rejected
that defense and held that broad
subcontracting agreements applicable to
every jobsite where the general contractor
might hire subcontractors were invalid when
entered outside of the context of a
collective bargaining relationship between
the union and the general contractor.

The employers who attack the

subcontracting clauses in the present case

argue that Connell's language necessarily

requires a conclusion that subcontracting
clauses are permissible only when they
serve the purpose of avoiding jobsite
friction between union and nonunion workers

employed at the same jobsite. So

A-36

interpreted, Connell would invalidate the
agreements in issue here at least until the
presence of union workers at a particular
jobsite triggered their application. We
concede at the outset that the Connell
opinion contains considerable emphasis on
problems of shoulder-to-shoulder friction
between union and nonunion workers at the
jobsite, and additional emphasis on
antagonism of the 1959 congress to
"top-down" organizing that is one of the
effects of subcontractor agreements.
Nevertheless, we believe that this reading
of the Connell decision misconstrues the
Supreme Court's view of § 8(e) and gives
too narrow a scope to the construction
industry proviso. We think that the
prevailing thrust of Connell is to the
contrary and favors a braoder view of the
exemption. Our conclusion is supported in
particular by the Connell opinion's

emphasis on the absence of a collective

A-37

bargaining relationship, its references to
legislative history, and its
characterization of the interests served by

the proviso.*>

Our view is reinforced by
the adverse practical consequences that
would follow from the narrower reading of
the proviso. Each of these factors bears
elaboration.

The first and most obvious distinction
of Connell from the present cases is that
the agreements in Connell arose outside of
the context of a collective bargaining
relationship. This fact was of course
crucial for antitrust purposes, because the
national policy of encouraging collective
bargaining has served as the basis for a
judicially created labor exemption from the
antitrust laws.2° The absence of such an
interest was pointedly referred to in
Connell:

itharist fa nibresenting

Connell's employees. The federal
policy favoring collective

A-38

bargaining therefore can offer no

shelter for the union's coercive

action against Connell or its

campaign to exclude nonunion

firms from the subcontracting

market.

421 U.S. at 626.*’ The focus of the
Connell decision was therefore
understandably upon the situation created
by subcontracting clauses in the basence of
a collective bargaining agreement with the
prime contracting employer.

That focus on the part of the Court
was not merely the product of the antitrust
setting of Connell, however. The parties
themselves had iramed the issues toward the
same end. the union contended that all
subcontractor agreements were validated by
the plain words of § 8(e). The employer
responded by urging that "despite the
unqualified language of the proviso,
Congress intended only to allow
subcontracting agreements within the
context of a collective-bargaining

relationship. . . ," but not those

A-39

involving a “stranger” contractor. Id. at
627.28 The subject of controversy, then,
was the validity of subcontractor
agreements outside of the collective
bargaining context, and the Connell opinion
must to a large degree be read in that
light. The Court's conclusion, reached
after a discussion of the legislative
history and policies behind § 8(e), was
Clearly limited to the situation before it:

We therefore hold that this

agreement, which is outside the

context of a collective

bargaining relationship and not
restricted to a particular

jobsite, .. . may be the basis
of a federal anti-trust
suit.

Id. at 635. the holding of Connell, then,
does not in the strict sense control the
cases before us.

The Connell opinion did, however,
discuss at length the reach of § 8(e) and
its construction industry proviso, upon
which the present cases turn. It therefore

becomes necessary to interpret the language

A-40

of connell and apply it to the situation of
the cases at bar where a collective
bargaining relationship existed between the
unions and the contractors with whom the

29 A major

agreements were sought.
question is whether the presence or
absence of a collective bargaining
relationship, obviously significant in the
antitrust context of Connell. remains
pivotal when the issue is purely one of
labor law.

We believe that there is a complex of
factors affecting labor relations in the
construction industry that renders the
collective bargaining relationship crucial
in the present cases and we find the
underlying policies reflected in parts of
the Connell opinion itself. We also
believe that these factors exist at the
construction jobsite but are by no means
limited to the problem of

shoulde--to-shoulder friction between

A-41

union and nonunion workers there. These
two themes -- the nature of the collective
bargaining relationship in the
construction industry and the manner in
which these characteristics are exhibited
at the jobsite -- are interwoven in Connell
as they are in the present controversy.

We will attempt, however, to discuss them
separately even though each will
necessarily intrude upon the other.

The legislative history already
discussed should make it clear that the
outstanding peculiarity of the
construction industry is that the work
force of any given employer -- contractor
or subcontractor -- is highly flexible and
grows or diminishes or even disappears
depending on the temporary contracting or
subcontracting arrangements at any
particular jobsite. As congress

recognized in passing § 9(f), collective

bargaining cannot even await the presence

A-42

of workers on the job. Moreover, when
there are workers already employed by a
general contractor, the interests of those
employees are not permanently or
inevitably bound to that single employer.
The employer has an option on any given
project to use some of his own workers, to
subcontract to an employer who will use
those same workers, or to subcontract to
one who will use others represented by the
same union, a different union, or no
union. Under those conditions the
employees and t’ 2ir unions are faced with
severe problems not only of maintaining
wage levels, but of protecting benefits
such as retirement pensions and paid
vacations that depend upon continuity of
employer contributions.

When a union representing a
contractor's employees seeks to. restrict
subcontracting to firms having a

collective bargaining agreement with the

A-43

union, the union in fact pursues a number
of objectives some of which might fairly
be characterized as primary and others as
secondary. The welfare of the employees
in the primary bargaining unit is clearly
likely to be affected by an employer's
choice to hire a subcontractor who may
himself employ those same employees. On
the other hand, the union clearly has
secondary goals that may include
organizing the employees of a
subcontractor who have no connection with
the primary bargaining unit.

It is quite true that when a union
seeks to serve the interests of employees
in its bargaining unit not as employees of
their existing employer, but as potential
employees of some other employer, the

arrangement is legally viewed as

secondary. National Woodwork, supra, at
644-45; National Maritime Union, supra.

We do not quarrel with this

A-44

well-established rule, nor with the rule
that when primary and secondary objectives
are combined, an agreement is regarded as
secondary for purposes of the National
Labor Relations Act. NLRB v. Denver
Buildings & Construction Trades Council,
341 :U.S. 675, 689 (1951).

We do, however, find sufficient
support in the legislative history of the
1959 Amendments to suggest that Congress
was sensitive to both the primary and
secondary considerations involved in
subcontractor arrangements and wished not
to interfere with these mixed union
objectives when they could be achieved by
agreement with the prime employer. Even
though a construction union's interest in
subcontracting at the jobsite is secondary
so as to bring it within § 8(e), it is far
more direct and involves the union's
members in the primary bargaining unit far

more than is the case when unions outside

A-45

of the construction industry pursue
secondary objectives.

The importance of this fact is that
it renders the existence of a collective
bargaining relationship highly
significant. When a union represents
employees of a prime contractor and seeks
a subcontracting agreement, it has the
interests of the employees in its primary
bargaining unit at stake to at least some
degree. In the Connell situation, the
union is utterly without any objective
that could be characterized as primary or
direct. Because the union in Connell
disclaimed any interest in representing
the employees of Connell, all of its goals
were necessarily secondary and could not
be connected to any primary
representational interest.

The significance of the restriction
of the § 8(e) proviso to work performed at

a jobsite may now become more clear. It

A-46

is at the jobsite that all of the special
characteristics of the construction
industry are manifested. It is true that
one of these characteristics is that union
workers are traditionally hostile to the
presence of nonunion workers on the same
job at the same time. But that is clearly
not the only or even the major
characteristic exhibited. It is at the
jobsite where the general contractor can
exercise the flexibility to use its own
workers or those of a subcontractor, where
the flexibility of subcontracting
arrangements may lead to multiple
employers hiring a few workers for short

30 and where working

periods of tiem,
conditions applicable to one set of
workers may very well affect others
working on the same project.?+

We believe that the Connell opinion
is sensitive both to the interconnection

of interests between employees of the

A-47

various contractors and subcontractors and
to the broad manner in which any or all of
these factors may be exhibited at the
jobsite. In dealing with the legislative
history of the construction industry
proviso, the opinion in Connell points out
that the proviso was "explained only by
bare reference to 'the pattern of
collective bargaining' in the industry."
421 U.S. at 628-29. The legislative
history discussed above indicates, we
believe, that the pattern of collective
bargaining included broad subcontracting
agreements. To the extent that the
just-quoted comment in Connell dismisses
the history regarding the pattern of
collective bargaining, it may well be
explained by the fact that Connell was
dealing with a case not considered by
congress, in which there was no collective

bargaining relationship. >

A-48

In any event, the subsequent language
of the Connell opinion appears quite
clearly to encompass the multiple
considerations affecting the construction
industry at the jobsite. The opinion
suggests that the construction industry
proviso may have been adopted “as a
partial substitute for an attempt to
voerrule" Denver Building Trades, 421 U.S.

at 629. Denver Building Trades had

outlawed the picketing of a contractor at
a jobsite in order to force it to cease
doing business with a nonunion
subcontractor working there. The Connell
opinion refers to congressional discussion
of special problems in the construction
industry related both to the § 8(e)
proviso and to the attempt to overrule

Denver Building Trades. That discussion,

according to the Court, "focused on the
problems of picketing a single nonunion

subcontractor on a multiemployer building

A-49

project, and the close relationship
between contractors and subcontractors at
the jobsite." Id. at 629-30. The Court's
footnote to this statement refers to
legislative history that clearly goes
beyond the problem of shoulder-to-shoulder
conflict between union and nonunion
workers at the jobsite. The first excerpt
referred to is by Senator Morse whose
statement includes the following:

The rormeamart | boycott ban is
based upon the concept of two
employers - a primary and a
secondary employer. Teh theory
is that a neutral employer
should not be compelled to
suffer because of a labor
dispute the union has with
somebody else, but the theory
breaks down when the two
employers are "allies." Senator
Taft said that the secondary
boycott section "is not intended
to apply to a case where the
third party is, in effect, in
cahoots with, 4 acting as a
part of, the primary

loyer." The eatisoal Labor
Relations Board and the courts
have failed to keep Senator
Taft's concept in mind. the
Board has considered
subsidiaries to be separate
employers. Other enterprises,

A-50

substantially controlled by the
same persons, have been
considered separate employers,
even though one manufactured a
product incorporated into the
aga article produced by the
other.

The case of the building and
construction industry
represented probably the most
flagrant injustice, where a
general contractor is, in
effect, entirely in control of
the kind of labor relations
taking place on a site which he
runs. He lets subcontracts
based upon price,
responsibility, and the ability
to handle labor relations.

He lets those contracts, very
well knowing the kind of labor
relations which may exist within
any of the subcontractor
companies. He is not acting in
the dark, Mr. President. He is
not innocent of any unfair labor
policies on the part of a
subcontractor.

105 Cong. Rec. 17880-81; II Leg. Hist. at
1425. Even where the sources cited by
Connell deal with union workers at the
jobsite, they reflect a number of
interests of the union that affect memsers

of its own bargaining unit as well as the

A-51

members in secondary employ. the
memorandum by representatives thompson and
Udall is illustrative:

Where all the men are employed
on the same project, the
division into different trades

, or crafts, each with its won
employer, must not be allowed to
obscure their common
interests-they work side by side
and the wages and working
conditions of one trade affect
all the others. This situation
is utterly unlike the situation
in true secondary boycotts, as
where carpenters in Los Angeles
refuse to work on nonunion doors
made in Minnesota by men whose
wages could not affect the wages
of at | pence in Los Angeles.
The illegality of such a boycott
would not be affected by the
amendment.

; [A] reason for outlawing
secondary boycotts is that they
drag neutral employers into
disputes in which they have no
interest. Where all the
employers affected are bound
together in the common work of
putting up a single building,
none is truly neutral. the
undertaking is so integral that
each is affected by and can
influence the conduct of the
others.

105 Cong. rec. 15541; II Leg. Hist. 1577.

A-52

These materials cited by the Connell Court
suggest a number of reasons why Congress
may have wanted to restrict the
construction industry's use of
subcontracting agreements to work done on
a jobsite. these aciitces do not limit
themselves to and, indeed, place very
little emphasis on, the problem of
shoulder-to-shoulder friction between
union and nonunion workers actually
present at the jobsite. .

The Connell opinion quotes National

Woodwork Manufacturers, supra, to the

effect that the construction industry
proviso is "designed to allow agreements
pertaining to certain secondary activities
on the construction site because of the
close community of interests there, but to
ban secondary-objective agreements
concerning nonjobsite work, in which
respect the construction industry is no

different from any other." 421 U.S. at

A-53

630, quoting 386 U.S. at 638-39. It is
clear that the Connell opinion views the
jobsite considerations of National
Woodwork as going well beyond the problem
of friction among workers, >* because
Connell next refers to some courts that
have suggested that the proviso serves an
“even narrower function" -- the
alleviation of "the frictions that may
arise when union men work continuously
alongside nonunion men on the same
construction site." Id. at 630, quoting
Drivers Local Union No. 695 v. NLRB, 361
F.2d 547, 553 (D.C. Cir. 1966). The

Connell opinion does not adopt this "even
narrower" reading of the proviso, and
indeed finds it unnecessary to treat the
matter further because in the Connell case
the union did not purport to represent any
of the interests served by the proviso.

421 U.S. at 631.>”

A-54

We believe that it would do some
violence to the language of the Connell
opinion to adopt the “even narrower" view
of the construction industry proviso which
the Court in Connell did not represent to
be its won. yet this consequence would
follow from restricting the applicability
of subcontractor agreements to those
instances where shoulder-shoulder jobsite
friction can occur. Instead, we think
that it si more in accord with the
language of Connell to permit those
agreements to apply to any jobsite at
which an employer with a collective
bargaining relationship with the union is
a contractor.

We concede that the language of the
Connell opinion dealing with congressional
antagonism to "top-down organizing" may
well lean in a direction contrary to our
views. We think it is countered by

Connell's recognition of other vital

A-55

concerns of collective bargaining in the
construction industry reflected in the
community of interest at the jobsite.
There is some "top-down organizing" effect
in any subcontracting agreement, including
those which all parties must admit would
be valid and within the proviso. When
there are union workers on the job next to
nonunion workers, the enforcement of a
subcontracting clause is still likely to
have a top-down organizing effect. the
answer to this point is simply that
Congress recognized that the community of
interests on the jobsite justified the
top-down organizational consequences that
may lead attend the protection of
legitimate collective bargaining
objectives there. The proviso is, after
all, an exception to the general thrust of
the 1959 amendments .°°

The Connell opinion's condemnation of

the "unlimited" top-down organizing weapon

A-56

with which it was confronted must be read
in the context of the applicable factual
and statutory framework. Because the
union in Connell disclaimed any interest
in organizing or representing connell's
employees, its picketing was not limited
to the 30 days established for
organizational picketing under § 8(b)(7).
It could therefore picket indefinitely to
obtain its objective of a subcontracting
agreement covering all subcontracting by
Connell. If the subcontractor clause were
held to be legitimate, there woudl be no
limit at all to the coercive force the
union coudl apply. The decision in
Connell solved this problem by holding
that the subcontracting agreement was an
unlawful goal when it was sought outside
of a collective bargaining context.

The situation is quite different when
a union seeks a subcontractor clause in

the context of a collective bargaining

An-57

relationship. In that situation, the
union's coercive force is limited. if the
Clause is sought in the course of
organizational or recognitional picketing,
that picketing will be subject to the
restrictions of § @(b)(7). If the union
already represents the contractor's
employees, the employer may resist any
attempts to secure a subcontractor
agreement by asserting its own bargaining
position and presenting its own demands.
The existence of a collective bargaining
relationship therefore avoids the
“unlimited” nature of the organizational
tool involved in Connell, where a stranger
contractor was powerless to resist
unlimited coercion by any means other than
signing the demanded subcontractor
agreement.

Finally, in summarizing the proviso's
effect, the Connell Court stated:

{(Wje think ite authorization
extends only to agreements in

A-58

the context of collective
bargaining relationships and, in
light of congressional
references to the Denver

waa
421 U.S at 633. While it might be
susceptible to another reading, we
interpret this language to mean that the
existence of a collective bargaining
relationship clearly brings a union
signator subcontracting agreemetn within
the proviso to § 8(e) and that in the
absence of a collective bargaining
relationship, it is possible that such an
agreement may be valid where the union
actually has workers on the job that may
be threatened with shoulder-to-shoulder

friction.>’

We consequently believe that
the quoted summary supports our conclusion
that Connell does not deny the protection
of the proviso to the subcontractor

agreements in the present cases.

A-59

(B) Practical Consequences.

Our reading of Connell to permit
broad subcontracting clauses within a
collective bargaining relationship not
only accords with the apparent thrust of
the legislative history, it si supported
by the sever practical limitations
attending a contrary conclusion.
Limitation of subcontracting agreements to
sites where there may be
shoulder-to-shoulder conflict between
union and nonunion workers presents
immense practical problems. if unions are
confined to negotiating these agreements
only when they find that there are union
employees on the jobsite, then they must
inventory and negotiate over an incredible
number of jobsites. AGC itself represents
some 200 general contract»rs. The number
of jobsites at which they contract is
unquestionably a multiple of that figure.
Jobsite by jobsite negotiation of

A-60

subcontracting agreements would seem
burdensome to the point of impossibility.
It also appears to run counter to
Congress's accommodation in § 8(f) to the
necessity in the industry of entering long
term agreements applying to employees not
yet hired for jobs not yet in existence.
S. Rep. No. 187, 86th Cong., lst Sess. 28
(1959); I Leg. Hist. 424.

Even if general subcontracting
agreements are permitted to be negotiated
wholsesale and then are triggered only
when union workers appear on the job, the
enforcement problems remain severe. The
transitory nature of employment at each
jobsite, as well as the difficulty of
defining the applicable time span during
which jobsite conflict is threatened,

38 If a rule

present substantial problems.
is adopted that the appearance of any
union worker on the job triggers

subcontracting agreements covering the

A-61

entire project, it presents an especially
strong incentive for anti-union
discrimination by employers.

We are presented, then, with a number
of practical and theoretical
considerations supporting our decision
that the present subcontracting
agreements, arrived at in the context of
collective bargaining relationships, are
withinthe proviso of § 8(e). First, there
are overwhelming practical difficulties in
confining the subcontractor agreements to
jobsites where actual union-nonunion or
interunion conflict occurs among workers.
Second, teh legislative history as well as
the actual conditions existing in the
construction industry militate in favor of
broad subcontractor clauses in collective
bargaining agreements. Third, the Connell
decision which admittedly has language
that might point to either result, may
fairly be read to support the validity of

A-62

subcontracting clauses when there is a
collective bargaining relationship,
regardless of the presence or absence of
union workers at the jobsite.

Given these considerations, we reject
a narrow interpretation of the proviso
which will substantially change the
existing practice in the industry. In
addition, we believe that due regard
should be given to the view of the
National Labor Relations Board supporting
these agreements.°” It is true tht the
position of the agency has not been an
unwavering one, *° but the Board's
articulation of current labor policy is
undoubtedly entitled to weight in our
decision.

VI.

Additional Issues.

It is contended by AGC that even if
the onstruction industry proviso

authorizes clauses requiring

A-63

subcontractors to have agreements with
unions in general, it does not permit
clauses to require a collective bargaining
agreement with a particular union. We
note, however, that nothing in the
language of the § 8(e) proviso suggests
such a limitation, even though
"“particular-union" clauses were a part of
industry practice at the time of its
enactment. Two months prior to the
creation of the proviso, the District of
Columbia Circuit upheld a
"particular-union": subcontractor
agreement it a decision that was submitted
to the House committee considering the

1959 amendments. Operating Engineers

Local Union No. 3 v. NLRB, supra; 2 House
Hearings 803-07. In the light of this

history, we do not feel free to find in
the proviso a limitation not written there
by Congress. We are joined in this

conclusion by the District of Columbia

A-64

Circuit in Donald Shriver, Inc. supra,

Slip op. at 52-5. WE also noted that
prohibition of "particular-union"
subcontractor clauses would defeat at
least some of the interests that we
earlier found to be served by the
construction industry proviso. One such
interest is that of a union in protecting
the wages and benefits of its members in
the primary bargaining unit who may later
work for subcontractors. That concern is
shared by no other union, and is best
served by a “particular-union" clause.

It is next contended, this time by
Woelke, that even if a subcontractor
agreement is protected by the construction
industry proviso, it is an unfair labor
practice for a union to picket or strike
in order to induce a contractor to enter
such an agreement. The legislative
history of the 1959 amendments is in ,

conflict on this point. 4+ The actual

A-65

working of § 8(b)(4)(ii)(A), however,
prohibits coercion of any person "to enter

into any agreement which is prohibited by

[§ 8(e))." 42 The negative implication of
this provision is surely that picketing or
striking to induce entry into an agreement
protected by the proviso to § 8(e) is
lawful.

After the 1959 amendments, the board
originally took the position that such
agreements had to be voluntarily entered,
but its position was uniformly rejected by
this and other courts of appeals.

Construction Production & Maintenance

Laborers Union, Local 383 v. NLRB,

(Coulson & Stevens Construction Co.) 323
F.2d 422 (9th Cir. 1963); Orange Belt

District Council of Painters No. 48 v.

NLRB, 328 F.2d 534, 537 (D.C. Cir. 1964);
eee

Essex County and Vicinity District Council

of Carpenters and Millwrights v. NLRB, 332
F.2d 636 (3d Cir. 1964). The Board

A-66

subsequently acquiesced in the court's

view. Northeastern Indiana Building &

Construction Council, 148 N.L.R.B. 854

(1964), remanded on other grounds, 352
F.2d 696 (D.C. Cir. 1965). We see no

reason to disturb the present law and to
read into the Act a limitation that runs
counter to the suggestion of its plain
words. Nor do we accept the contention
that picketing or striking to obtain a
subcontractor agreement violates the § 7
rights of employees of subcontractors;
they are no more affected by a
subcontractor agreemetn achieved by
picketing than by one voluntarily
entered.

The final issue concerns the effect
of the provision in the AGC contract that
permits each party to resort to self-help
when the other party does not comply with
an arbitration decision made pursuan to

the grievance procedure. *? The Board

A-67

concluded that these provisions authorized
picketing or strikes to enforce the
subcontractor agreement, and held that the
contract was consequently unlawful. The
rule that picketing or strikes may not be
used to enforce subcontractor agreements
arises from the fact that the 1959
amendments exempted the construction
industry from § 8(e)'s prohibition against
secondary boycott agreements, but did not
exempt it from § 8(b)(4)(ii)(B), which
forbids economic coercion to enforce such
a boycott. The legislative history maeks
clear Congress's intent that subcontractor
clauses entered pursuant to § 8(e) were to
be enforced judicially rather than by
self-help, ** and this court has followed

that view. NLRB v. International

Brotherhood of Electrical Workers, 405
F.2d 159, 163-64 (9th Cir. 1968), cert.
denied, 395 U.S. 921 (1969). We have also

held that such clauses may be enforced by

A-68

arbitration. La Mirada Trucking, Inc., v.

Teamsters Local Union 166, 538 F.2d 286
(9th Cir. 1976).

Engineers argue, without pressing the
point strongly, that self-help to enforce
an arbitration award that in turn enforces
a subcontractor agreement is not
unlawful . The picketing or strike,
according to the Union, is simply
enforcing the arbitration award and not
the underlying agreement. We believe that
acceptance of this contention would too
easily circumvent the clear intent of
Congress and would do violence to the
plain words of § 8(b)(4)(ii)(B). Nor can
we accept the suggestion of the Union that
the AGC agreement must be construed to
limit the self-help clause to self-help
which is determined to be lawful. We must
take the agreement to mean what it says.
Operating Engineers, Local No. 701 v.
NLRB, 578 F.2d 841, 842 (9th Cir. 1978);

A-69

Donald Schriver, Inc., v. NLRB, supra,

slip op. at 57-58.
VII.

Conclusion.

We find that provisions i a
collective bargaining agreement forbidding
the signatory employer to subcontract work
at a construction site to firms that do
not have a contract with the signatory
union are within § 8(e) of the National
Labor Relations Act, but are protected by
the construction industry proviso to the
section. They need not be limited to
jobsites presenting the possibility of
conflict between union and nonunion
workers. We also find that unions may
picket or strike to induce employers to
enter suhc agreements but that, once
entered, the agreement may not be enforced
by self-help. Clauses authorizing
self-help enforcement, directly or through

arbitration decisions, are consequently

A-70

invalid. We accordingly enforce the

orders of the Board in their entirety.

A-71

FOOTNOTES

1. Other relevant clauses of the AGC agreement are:
ARTICLE IX

Settlement of Disputes

Grievances Procedure

Section 1. In the settlement of disputes
arising out of a violation, misunderstanding
or difference in interpretation of this
agreement, the following procedure shall be
followed:

**REK

Section 5. Should the parties involved fail
to comply with the [arbitrator's] findings
within five (5) days after such written
notification by either party . . ., then all
means of arbitration shall be considered
exhausted.

Either party may take such action as they
deem necessary to enforce the findings...
and they shall not be considered in
violation of any part of this Agreement.

ARTICLE X
Strikes and Lockouts

Section 1. Unless otherwise provided
herein, it is mutually agreed that there
will be no strikes or lockouts, or cessation
of work by either party, for the duration of
this Agreement. All disputes arising under
this Agreement shall be submitted to the
procedures for the settlement of disputes as
provided in this Agreement. ...

2. Section 8(e), 29 U.S.C. § 158(e), provides in

| pertinent part:

A-72

It shall be an unfair labor practice for any
labor organization and any employer to enter
into any contract or agreement, express or
implied, whereby such employer ceases or
refrains or agrees to cease or refrain from
handling, using, selling, transporting or
otherwise dealing in any of the products of
any other employer, or to cease doing
business with any other person, and any
contract or agreement entered into
heretofore or hereafter containing such an
agreement shall be to such extent
unenforceable and void: Provided, That
nothing in this subsection shall apply to an
agreement between a labor organization and
an employer in the construction industry
relating to the contracting or
subcontracting of work to be done at the
site of the construction, alteration,
painting or repair of a building, structure,
or other work... .

3. Another issue over which the parties reached
impasse was Carpenters' demand to include Woelke's
foreman in the bargaining unit. The Board found that
picketing to enforce this demand violated § 8(b)(1)(B)
of the Act. The union has not contested that ruling in
this court. We therefore enforce the Board's order
concerning this issue.
4. The proposed clause provides:
The Contractor agrees that neither he nor

any of his subcontractors on the jobsite

will subcontract any work to be done at the

site of constrv:tion, alteration, painting

or repair of a building, structure or other
work (including quarries, rock, sand and

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gravel plants, asphalt plants, ready-mix
concrete plants, established on or adjacent
to the jobsite to process or supply
materials for the convenience of the
Contractor for jobsite use) except to a
person, firm or corporation, party to an
appropriate, current labor agreement with
the appropriate Union, or subordinate body
signatory to this Agreement.

5. Sections 8(b)(4)(i) and (ii)(A) and (B), 29 U.S.C.
§ 158(b)(4)(i) and (ii)(A) and (B), provide:

(b) It shall be an unfair labor practice
for a labor organization or itw agents --

(4)(i) to engage in, or to induce or
encourage any individual employed by
any person engaged in commerce or in an
industry affecting commerce to engage
in, a strike or a refusal in the course
of his employment to use, manufacture,
process, transport, or otherwise handle
or work on any goods, articles,
materials, or commodities or to perform
any services; or (ii) to threaten,
coerce, or restrain any person engaged
in commerce or in an industry affecting
commerce, where in either case an
object thereof is -

(A) forcing or requiring any
employer or self-employed person
to join any labor or employer
organization or to enter into any
agreement which is prohibited by
subsection (e) of this section;
(B) forcing or requiring any
person to cease using, selling,
handling, transporting, or
otherwise dealing in the products
of any other producer, processor,
or manufacturer, or to cease doing

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business with any other person, or
forcing or requiring any other
employer to recognize or bargain
with a labor organization as the
representative of his employees
unless such labor organization has
been certified as the
representative of such employees
under the provisions of

section 159 of this title:
Provided, That nothing contained
in this clause (B) shall be
construed to make unlawful, where
not otherwise unlawful, any
primary strike or primary
picketing. ...

6. ‘Along with the present cases, reported at
239 N.L.R.B. 274 (1978) (Pacific Northwest) and

239 N.L.R.B. 241 (Woelke), the Board decided Los
Angeles Building & Construction Trade Council (Donald

Schriver, Inc.), 239 N.L.R.B. 264 (1978), and Colorado

Building & Construction Trades Council, 239 N.L.R.B.

253 (1978). The Board's order upholding broad
subcontractor agreements in Schriver was enforced by
the District of Columbia Circuit in an extensive and

instructive opinion by Judge Edwards. Donald Schriver,

Inc. v. NLRB, Nos. 78-2177, 79-1001, slip op. (D.C.

Cir. Oct. 20, 1980).
7. “Union standards" clauses, which require that an

employer not subcontract with anyone whose wage and

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benefit scale does not meet union standards, have also
been held primary. The purpose of such clauses is
deemed to be protection of the pay and benefit scales

of the workers of the primary employer. Truck Drivers

Union Local No. 413 v. NLRB, 334 F.2d 539, 548 (D.C.

Cir.), cert. denied, 379 U.S. 916 (1964); NLRB v.

National Maritime Union, 486 F.2d 907, 912 (2d Cir.

1973), cert. denied, 416 U.S. 970 (1974).

8. Haber, Industrial Relations in the Building
Industry 238-40 (1930). A study by the National
Manufacturers Association reported that in 1926, 69% of
all construction work was done under closed-shop
conditions. Id. at 240.

9. Dunlop, The Industrial Relations System in

Construction, in The Structure of Collective Bargaining

255, 256-57 (Weber ed. 1961).

10. S. Rep. No. 187, supra, 28; I Leg. Hist. 424. See
generally, Labor-Management Reform Legislation,
Hearings before the Subcommittee on Labor of the
Committee of Labor and Public Welfare, United States
Senate (hereinafter Senate Hearings), 86th Cong., Ist
Sess. 136 (testimony of Professor Cox).

A-76

11. A union attempt to limit subcontracting to union
firms was held exempt from the antitrust laws as early

as 1934. Levering & Garrigues Co. v. Morrin, 71 F.2d

284 (2d Cir.), cert. denied, 293 U.S. 595 (1934).

12. Marcus, Secondary Boycotts, in Symposium on the

Labor-Management Reporting Disclosure Act of 1959, 822,
824 (Slovenko ed. 1961) (hereinafter referred to as
LMRDA Symposium).

13. Brown and Root, Inc., 51 N.L.R.5. 820 (1943);

Johns-Manville Corp., 61 N.L.R.B. 1 (1945).

14. The relevant portions of § 8(b)(4)(A) are now in
§ 8(b)(4)(ii)(B), quoted in note 4 supra.

15. Denham, Taft Act's Impact on the Construction

Industry, reprinted in 21 L.R.R.M. 44 (1948). The

Board's decision to exercise jurisdiction over the
industry following passage of the Taft-Hartley
Amendments resulted, in part, from the Amendments’
prohibiting the closed shop and “back up crews"
(featherbedding), two accepted practices in the
construction industry. Despite the General Counsel's
action, the Taft-Hartley Act was virtually ignored

within the construction industry until the Board

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decided United Ass'n of Journeymen & Apprentices of

Plumbing and Pipefitting Industry (Brown-Olds), 115

N.L.R.B. 594 (1956), and Mountain Pacific Chapter of

Associated General Contractors Inc. (Mountain-Pacific),

119 N.L.R.B. 883 (1958), remanded on other grounds, 270

F.2¢ 425 (9th Cir. 1959). Appruzzese, The LMRDA and

the Building and Construction Industry, LMRDA

Symposium, note 12, supra, 1019, 1029. Thereafter the
General Counsel granted a moratorium to the
construction industry to allow it to bring its hiring
hall practices into line with the provisions of the

Taft-Hartley Act. See Fenton, Union Hiring Halls:

NLRB Rules, Penalties, 42 L.R.R.M. 101, 103 (1958).

16. Section 8(f), 29 U.S.C. § 158(f), provides:

It shall not be an unfair labor practice
under subsections (a) and (b) of this
section for an employer engaged primarily in
the building and construction industry to
make an agreement covering employees engaged
(or who, upon their employment, wiki be
engaged) in the building and construction
industry with a labor organization of which
building and construction employees are
members (not established, maintained, or
assistcd by any action defined in

sub::ection (a) of this section as an unfair
lavor practice) because (1) the majority
status of such labor organization has not
been established under the provisions of
section 159 of this title prior to the

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making of such agreement, or (2) such
agreement requires as a condition of
employment, membership in such labor
organization after the seventh day following
the beginning of such employment or the
effective date of the agreement, whichever
is later, or (3) such agreement requires the
employer to notify such labor organization
of opportunities for employment with such
employer, or gives such labor organization
an opportunity to refer qualified applicants
for such employment, or (4) such agreement
specifies minimum training or experience
qualifications for employment or provides
for priority in opportunities for employment
based upon length of service with such
employer, in the industry or in the
particular geographical area: Provided,
That nothing in this subsection shall set
aside the final proviso to subsection (a) (3)
of this section: Provided further, That any
agreement which would be invalid, but for
clause (1) of this subsection, shall not be
a bar to a petition filed pursuant to
section 159(c) or 159(e) of this title.

17. S. 1555, 1 Leg. Hist. 582.
18. H.R. 8342 as amended by H.R. 8400, I Leg. Hist.
683.
19. H.R. Rep. No. 1147 (Conference Report) 86th Cong.,
Ist Sess. 38-40; I Leg. Hist. 942-44 (1959).
20. The garment industry proviso to § 8(e), 29 U.S.C.
§ 158(e), states:

Provided further, That for the purpose of

this subsection and subsection (b)(4)(B) of

this section the terms "any employer", “any
person engaged in commerce or an industry

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affecting commerce", and "any person" when

used in relation to the terms "any other

producer, processor, or manufacturer", "any

other employer" or "any other person" shall

not include persons i: the relation of a

jobber, manufacturer, contractor, or

subcontractor working on the goods or

premises of the jobber or manufacturer or

performing parts of an integrated process of

production in the apparel and clothing

industry. ...
21. There is a substantial explanation in the
legislative history of the highly integrated
subcontiacting arrangements in the garment industry and
the problem of "sweatshop" conditions. See, e.g., 105
Cong. Rec. 17381, II Leg. Hist. 1385 (Senators Javits
and Goldwater); 105 Cong. Rec. 15538, II Leg. Hist.
1576 (Memorandum of Reps. Thompson and Udall); 105
Cong. Rec. 15848; II Leg. Hist. 1680 (Rep. Teller).
22. The Engineers decision was submitted to the House
committee investigating labor practices as part of the
testimony of Paul H. Robbins, Executive Director of the
National Society of Professional Engineers. 2 Hearings
Before a Joint Subcommittee of the Committee on
Education and Labor, House of Representatives, 86th
Cong., lst Sess. on H.R. 3540, H.R. 3302, H.R. 4473 and

H.R. 4474 and Related Bills Regarding Labor-Management

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Reform Legislation, 803-07 (1959) (hereafter House
Hearings).

In addition, Edward M. Carlton, office manager of
St. Maurice, Helkamp and Musser, the subcontractor
involved in Engineers, appeared before the Committee
and testified as to the scope of the contracting
clause:

The contract also contains a clause which is
referred to in the industry as the
subcontractor clauses. In effect, that
clauses (sic) says that any time an AGC
contractor subcontracts work the
subcontractor must agree to apply the terms
and conditions of the AGC Operating
Engineers' agreement to his employees.
This, of course, means that the
subcontractor's employees must become
members of Operating Engineers Local 3.

Since about 1955, the AGC and the
Operating Engineers have enlarged the
subcontractor clauses so that an AGC
contractor will not subcontract any work
unless the subcontractor agrees in advance
to be bound by the AGC Operating Engineers’
agreement.

5 House Hearings 2366 (Emphasis supplied).

Although the Engineers decision was not directly
referred to in the Senate Hearings, the problem of

union signatory clauses was brought to the committee's

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attention. Senate Hearings 752 (Testimony of Sen.
Curtis).

23. Office of the General Counsel, Memorandum 76-57,
December 15, 1976, reprinted in Labor Relations
Yearbook 1976, p. 295. Because Lunden failed
adequately to distinguish between union signatory and
union standards clauses, the General Counsel found that
study “inconclusive.” Id. at 308. The General
Counsel's own study concluded that there was no
“pattern” of collective bargaining in the industry, but
that the existing clauses constituted only a "mosaic."
Union signatory clauses, not restricted to a particular
jobsite, were part of that mosaic. Id. at 309.

24. Connell was another chapter in the dispute in
Dallas between building contractors and trade unions.

In Dallas Building & Construction Trades Council v.

NLRB, 396 F.2d 677 (D.C. Cir. 1968), a clause similar
to the one in Connell was at issue. Unlike Connell,
however, the general contractor that was picketed had
nonunion employees. Although the Trades Council
expressly disavowed any interest in organizing the

general contractor's workers, both the Board and the

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District of Columbia Circuit Court of Appeals concluded
otherwise. The..court held that because there was an
organizational objective the picketing was limited to
thirty days be § 8(b)(7), a period which the unions had
exceeded.

The court's opinion left open the possibility of
picketing more than thirty days if the unions could
conclusively show no organizational objective. In
order to avoid the § 8(b)(7) problem, the unions
picketed contractors who had no employees of their own.
The contractors sought to challenge this practice
before the Board, but the General Counsel refused to
issue a complaint. See Connell, 483 F.2d 1154, 1158
(Sth Cir. 1973), and 421 U.S. at 631-32 n. 10.

When Local 100 began picketing Connell, the
contractor did not file a complaint with the Board, but
immediately sued the union for violating both federal
and state antitrust laws.

25. But for the Connell decision, we would have no
difficulty in enforcing the Board's order. Prior to
Connell, this court, other circuits and the Board had

upheld broad subcontracting clauses in collective

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bargaining agreements. See, e.g., Construction,

Production & Maintenance Laborers Union, Local 383 v.

NLRB, 323 F.2d 422 (9th Cir. 1963); Suburban Title

Center Inc. v. Rockford Building & Construction Trades

Council, 354 F.2d 1, 2-3 (7th Cir. 1965), cert. denied,

384 U.S. 960 (1966); United Association of Journeymen &

Apprentices of the Plumbing and Pipefitting Industry,

Local 48, 190 N.L.R.B. 415, 416-17 (1971).
26. See Connell, 421 U.S. at 622-23; St. Antoine,

Connell: Antitrust Law at the Expense of Labor Law, 62

Va. L. Rev. 603 (1976). Labor unions also have a
statutory exemption from the antitrust laws by virtue
of sections 6 and 20 of the Clayton Act, 15 U.S.C.

§ 17, 29 U.S.C., § 52, and sections 4, 5 and 13 of the
Norris-LaGuardia Act, 29 U.S.C. §§ 104, 105, 113.
These statutes declare that labor unions are not
combinations in restraint of trade and exempt specific
union activities including secondary boycotts from the
antitrust laws and from certain kinds of injunctive
relief. These statutes do not, however, exempt
concerted activity or agreements between unions and

non-labor parties. Connell, supra, 622-23. See

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generally, R. Gorman, Basic Text on Labor Law. 621-31
(1976).

27. The fact that Connell was an antitrust case
outside of the context of collective bargaining led to
a natural emphasis by the Court on the pursuit of
market efficiency through competition. This emphasis
reappears in the dissent here, infra p. __, but we
find it far less compelling in this labor case in which
no antitrust issues have been raised. The thrust of
the labor laws, of course, is frequently contrary to
that of the antitrust laws. See St. Antoine, supra,
n. 26.

28. The briefs in Connell concentrated entirely on the
distinction between the presence and absence of a
collective bargaining relationship in determining ive
validity of subcontracting clauses. The policy of
preventing jobsite friction was raised tangentially in
the appendix to Local 100's brief which included a
memorandum by the NLRB General Counsel explaining why
he would not issue a complaint in a case factually
similar to Connell. Significantly, that memorandum,

dealing with Hagler Construction Co., was distinguished

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in the Connell opinion as being " . . . addressed to a
different argument that a subcontracting clause should

be allowed only if there is a pre-existing collective

bargaining relationship with the general contractor or
if the general contractor has employees who perform the
kind of work covered by the agreement." 421 U.S. at
632 n. 10. (emphasis in original).

29. In Woelke, the union had entered a three-year
collective bargaining agreement with the employer and
the dispute arose during negotiations to renew the

contract. In Pacific Northwest, the union had long had

a continuous collective bargaining agreement with the
Association of General Contractors. We therefore need
not reach and express no opinion on the question
whether a "prehire" agreement entered or sought
pursuant to § 8(f) of the Act is a sufficient
"collective bargaining relationship" to render
permissible the entry of subcontracting agreements. We
note that prehire agreements were held sufficient to

legitimize subcontracting agreements in Donald Shriver

Inc. v. NLRB, Nos. 78-2177 and 79-1001, slip op. (D.C.
Cir. Oct. 20, 1980).

A-86

30. The 1977 Census of Construction Industries found
that there were more than 288,000 "specialty trade
contractors" (a category which includes fifteen
different subcontracting functions). On the average,
each ‘irm employed six construction workers.

U.S. Bureau of the Census, Census of Construction
Industries (1977), cited in Statistical Abstract of the
United States (1979) Table 1365, p. 776.

One commentator has aptly summarized the peculiar
problems confronted by labor unions attempting to
Organize construction workers as well as the techniques
which they have employed:

Union insistence on having the contractor
use only union men runs counter to the
general theory of free determination on
which the Wagner Act was based. Elections
on the part of the employees are
impractical, however, in an industry where
the employment may be over before an
election can be held, and where the
employees on the next job may be a
substantially different group. It would be
literally impossible to maintain a union if
the men had to be organized anew each time
they went to a new job. The industrial
union can afford the luxury of indifference
as to whom the employer hires because the
important thing is to organize the employees
once they are on the job. The building
trade union cannot operate efficiently
unless it can require the employer to hire
its members in the first place.

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{[B]uilding trade unions [therefore] have not
organized employees by techniques familiar
to manufacturing. Instead, the construction
unions have, in effect, organized the
employers. An agreement with the employer
that he will hire only union members is much
the most effective way to standardize
working conditions in an industry where jobs
are so fluid.

LMRDA Symposium, supra, note 12, at 1034, 1043.
31. See Donald Schriver Inc., supra, slip op.
at 43-46.

32. In Connell, the Fifth Circuit requested that the
parties and their amici submit supplemental briefs
concerning the pattern of bargaining practices at the
time of the 1959 amendments. The union was unable to
provide any information which would allow the
conclusion that stranger clauses were part of the
pattern and that Congress therefore intended to
preserve this practice. 483 F.2d at 1182 (dissenting
opinion). Such is not the case with regard to
particular union clauses. The decision of the District

of Columbia Circuit in Operating Engineers, supra, as

well as the House and Senate Hearings, supra, note 24,

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suggest that Congress was well aware of the existence
of these clauses.

33. Senator Taft's remarks were part of a colloquy
with Senator Ives on June 30, 1949, 95 Cong.

Record 8709. Senator Taft was referring to the garment
industry, but he cited for his proposition a case that
involved the construction industry: Douds v.

Metropolitan Federation of Architects, Engineers,

Chemists & Technicians, Local 231, (Project Engineering

Co.), 75 F.Supp. 672 (S.D.N.Y. 1948).

34. Indeed, National Woodwork contains a footnote

reference succeeding the discussion of the "close
community of interests" on the jobsite. 386 U.S.

at 639 n. 32. That footnote refers to Essex County and

Vicinity District Council of Carpenters and Millwrights

v. NLRB, 332 F.2d 636 (3d Cir. 1964), which does deal
with shoulder-to-shoulder friction. It also refers,
however, to a Yale Law Journal Comment. The Impact of
the Taft-Hartley Act on the Building and Construction

Industry, 60 Yale L.J. 673, 684-89 (1951), which
discusses not only jobsite friction but also the

additional considerations of interchangeability of

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workers, short time span, flexible contracting
arrangements, and numerous other interests that a union
representing a primary group of employees may have in
the employment arrangements of other employees at the
jobsite.

35. Essentially the same situation was dealt with by

this court in ACCO Construction Equipment, Inc. v.

NLRB, 511 F.2d 848 (9th Cir. 1975). ACCO does contain
language tending to restrict the jobsite proviso to the
goals of avoiding shoulder-to-shoulder friction, but we
do not read that as essential to its decision. ACCO
was written before Connell and it dealt with what were
essentially off-site workers who only occasionally
worked on-site. They and their employers were not at
all involved in the "community of interests" which are

emphasized in National Woodwork, Connell, and this

opinion. The union's objectives in organizing such
off-site workers were indirect and wholly secondary;
the primary interests of workers in the bargaining unit
at the jobsite could not be directly affected by, and

were not interchangeable with, the off-site workers.

eRe i ly

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36. Because the proviso is an exception to the 1959
amendments, we cannot accept the test for its
interpretation adopted at the conclusion of the
dissent. The issue is not which interpretation is the
more faithful to Congress’ overall goal in the 1959
amendments of curbing "top-down" organizing. Instead,
the question is which interpretation best effectuates
curbing “top-down" organizing and of protecting
collective bargaining under the peculiar conditions of
the construction industry.

37. Our reading of the quoted language in

Connell as presenting disjunctive alternatives

rather than conjunctive and cumulative

requirement is supported by the District of

Columbia Circuit and probably by the Third

Circuit. Donald Schriver, Inc., supra; Larry v.

Muko, Inc. v. Southwestern Pennsylvania Building

& Construction Trades Council, 609 F.2d 1368,

1374-75 (3rd Cir. 1979) (en banc). Lower courts
and commentators have varied in their approach
to the underlying issue. See Landscape

Specialties, Inc. v. Laborers' International

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Union, Local 806, 477 F. Supp. 17 (C.D. Cal.

1979); Long v. Floorcraft Carpet Co., 82 Labor

cases 7 10,044 (D. OR. 1977); St. Antoine,
supra, 62 Va. L. Rev. at 619; Janofsky & Hay,

Connell -- Consistent with Past, Indicative of

Future, Proceedings of N.Y.U. Twenty-Ninth
Annual Conference on Labor 3, 21-22 (1976).
Normally, a union without a collective
bargaining relationship that seeks a
subcontracting clause will be pursuing no
interest that could impact upon its primary
representation of anyone. The rare exception
might occur when the union has its own employees
working for some other employer on the jobsite
and shoulder-to-shoulder friction threatens.
38. The dissent makes the point that even
under our decision, unions must police jobsites
to ensure compliance with subcontractor clauses.
We believe that it is a more manageable task,
however, to police jobsites to ensure that
subcontractors working there have agreements

with the policing union than it is to determine

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whether any union worker has been working on the
jobsite at any time, or perhaps at any time when
that worker's presence might lead to jobsite
friction.

39. NLRB v. Yeshiva University, 444 U.S.

6727 691 (1980). Compare Beth Israel Hospital

v. NLRB, 437 U.S. 483, 500-01 (1978), and NLRB

v. International Association of Bridge,

Structural & Oramental Iron Workers, 434 U.S.

335, 350-51 (1978), with NLRB v. International

Longshoremen's Association, 100 S. Ct. 2305
(1980).

40. See International Union of Operating

Engineers Locals 542, 542-A and 542-B, (York
County Bridge, Inc.) 216 N.L.R.B. 408, 409

(1975), enforced, 532 F.2d 902 (3d Cir. 1976),
cert. denied, 429 U.S. 1072 (1977); General

Counsel Memorandum, note 25, supra.

4i. Representative Barden, the Leader of
the House conferees, referred to the proviso as
permitting "voluntary agreements." 105 Cong.
Rec. 18128; II Leg. Hist. 1715.

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Senator Kennedy, the leader of the Senate
conferees, appeared to be of the view that
economic coercion was permissible; and stated
that the proviso was not intended to change the
law "with respect to the legality of a strike to
obtain such a contract." 105 Cong. Rec. 17900,
II Leg. Hist. 1433.

Senator Goldwater, one of the Senate
conferees, and the man who may have been most
responsible for the Landrum-Griffin Amendments,
see 105 Cong. Rec. 15516, II Leg. Hist. 1552
(statement of Rep. Madden), said that the
question was left open for the courts to decide.
105 Cong. Rec. 19772, II Leg. Hist. 1858.

42. (Emphasis supplied). Section
8(b)(4)(ii)(A) appears supra note 4.

43. See note 1, supra.

44. The Conference Committee, after
stating that it did not intend the proviso to
change existing law regarding subcontractor
agreements, stated: "Picketing to enforce such

contracts would be illegal under the Sand Door

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case Local 1796, United Brotherhood of

Carpenters v. NLRB, 357 U.S. 93 (1958)." H.R.

Rep. No. 1147, 86th Cong., Ist Sess. 39, I Leg.
Hist. 943. See also, 105 Cong. Rec. 17900, II
Leg. Hist. 1433 (remarks of Sen. Kennedy).
Senator Goldwater subsequently explained the
proviso as follows: "The union may go into a
court and sue [the contractor] if he fails to
live up to that agreement. But they cannot
strike or picket him to make him live up to
it. . .." 105 Cong. Rec. A8359, II Leg. Hist.
1830.

A-95

Son Ag gee Roper gD ogeay Ie
al. - Nos. 76-3469, 78-3487, 76-3619, 78-3468,
79-7011
SNEED, Circuit Judge, (with whom CHOY, ANDERSON
and FARRIS, Circuit Judges, concur) dissenting:
As with many legal issues, where one ends
up in this case depends upon were one starts.
While I have no disagreement with the court's
holding that union signatory clauses are
secondary and within the scope of section 8(e),
I respectfully dissent from its holding that
such clauses are invariably within the
construction industry proviso to section 8(e)
when a collective bargaining relationship exists
between the employer and the union seeking the
Clause. The majority reaches it conclusion by
commencing with the view that the construction
industry presents unique problems in labor
relations that require the legitimation of union
signatory clauses. Although admitting that the
legislative history is not compelling, the court
finds that legitimation was provided by the

construction industry proviso. My starting

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point, on the other hand, is with Connell

Construction Co. v. Plumbers & Steamfitters Local

Union No. 100, 421 U.S. 616 (1975), and its

concern with the "top-down organizing" effect of
union signatory clauses. This concern led the
panel before which this case was heard
originally to hold as follows:

"We hold that the construction
industry proviso extends shelter
only when a collective bargaining
rb ager exists and even then
only when the employer or his
subcontractor has employees who are
members of the signatory union at
work at some time at the jobsite at
which the employer wishes to engage
a nonunion subcontractor." Pacific
Northwest Chapter of the Associated
Buildiers & Contractors, Inc. v.
woe, 009 F.2d 1341, 1347 (9th Cir.

I would adhere to that holding and to the

reasons given by the panel therefor. Id. at
1348-50.

The court rejects the panel's result
because it is said to represent an "even
narrower" view of the construction industry

proviso than that adopted by the Supreme court

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in Connell. F.2d (p. 26 majority

opinion). Alleviation of "the frictions that
may arise when union men work continuously
alongside nonunion men on the same construction
site," 421 U.S. at 630, is said not to have been
a concern of the Supreme Court in Connell
because in that case "the union did not purport
to represent any of the interest served by the
proviso." — F.2d __—s (p. 26). Presumably
this is because there was no collective
bargaining agreement between the employer and
union in that case.

As I see it, the crucial language in
Connell is as follows:

"We therefore hold that this
agreement, which is outside the
context of a collective-bargaining
relationship and not restricted to a
particular jobsite, but which
nonetheless obligates Connell to
subcontract work only to firms that
have a contract with Local 100, may be
the basis of a federal antitrust suit
because it has a potential for
restraining competition in the
business market in ways that would not
follow naturally from elimination of
competition over wages and working
conditions." 421 U.S. at 635.

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This language, as the majority acknowledges, is
not entirely unambiguous. It is, however, not
inconsistent with the panel's holding as set out
above; and, more importantly, that holding is

more empathetic with Connell's concern with the

"top-down" organizing effect of union signatory
clauses than is that of the majority.

It is true, as the majority states, that
any union signatory clause has some "top-down"
organizing effect. The difference between the
panel's holding and that of the en banc court
lies in the scope of this effect. The en banc
court permits a clause that forbids
subcontracting work covered by the collective
bargaining agreement to any firm not having a
contract with the signatory union. It matters
not whether any of the employees of the signatory
employer, who are members of the signatory
union, are employed on the jobsite. It matters
mot that, in the absence of the union signatory
clause, the work could have been subcontracted

to a firm which, even though adhering to union

A-99

standards governing wages and working conditions,
was more efficient than its competitiors.

It must be acknowleged that the panel's
holding would not greatly diminish the
"top-down" organizing effect of the union
signatory clause. It would permit the choice of
the more efficient firm only when to do so would
entail no jobsite friction between members of
the signatory union and workers performing work
covered by the collective bargaining agreement.
Thus, a provision in the agreement precluding
subcontracting of all the covered work would
prevent choice of the more efficient firm and
thus provide a substantial "top-down" organizing
effect. A clause prohibiting subcontracting is

permissible. National Woodwork Manufacturers

Association v. NLRB, 386 U.S. 612, 644-46

(1967); see also Fibreboard Paper Products Corp.
v. NLRB, 379 U.S. 203 (1964); NLRB v. Johnson,
368 F.2d 549 (9th Cir. 1966). However, the

panel's holding would afford an opportunity by

which an employer could accept a union signatory

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clause without sacrificing all right to choose
the more efficient subcontractor. Preservation
of this opportunity would be more consistent
with the primary concern of Connell than is the
position of the en banc court. I doubt that the
en banc court seriously contends otherwise. It
does believe that the preservation of this
opportunity would provide a "strong incentive
for anti-union discrimination by employers."
___ F.2d ss (ip. 29). I am dubious. Under
either view an anti-union employer will strive
to avoid a union signatory clause. That an
employer under the panel's view would have a
limited opportunity to subcontract to a firm not
having an agreement with the signatory union is
not likely to make it more anti-union.

I agree with the en banc court that the
legislative history of the construction industry
proviso is not conclusive. We have previously
considered the legislative history of the
proviso. ACCO Construction Equipment, Inc. v.
NLRB, 511 F.2d 848, 851 (9th Cir. 1975). In

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surveying the legislative history, we concluded
that the dominant motive of Congress in adopting
the proviso was to permit agreements that aimed
at eliminating jobsite friction between union
and nonunion workers. Id. at 851; accord,
Drivers Local 695 v. NLRB, 361 F.2d 547, 553
'(D.C. Cir. 1966); Essex County District Council

of Carpenters v. NLRB, 332 F.2d 636, 640 (3d
Cir. 1964). And the National Labor Relations
Board previously believed: "(T]he 8(e) proviso
was intended to prevent labor strife among
nonunion and union employees at the same
jobsite." International Union of Operating
Engineers, Locals 542, 542-A and 542-B, 216 .
N.L.R.B. 408, 409 (1975), enforced, 532 F.2d 902
(3d Cir. 1976), cert. denied, 429 U.S. 1072

(1977). I see no reason to depart from our
earlier analysis of the purpose of the proviso.
Admittedly, Senator Kennedy thought that
the construction industry proviso would permit
subcontracting clauses such as those challenged

in these cases. Others argued that the proviso

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was intended to permit agreements not to use
prefabricated pipe unless union workers did the
fabricating. 105 Cong. Rec. 19785-86, 19809
(1959); II Leg. Hist. 1815-16 (extension of
remarks of Senator McNamara and Representative
Thompson); contra 105 Cong. Rec. 20004-05
(1959); II Leg. Hist. 186

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385007_2038%3A1. Public record. Not legal advice.
