Amicus Curiae Brief — Laborers Health & Welfare Trust Fund v. Advanced Lightweight Concrete Co.

eee

OcTOBER TERM, 1986

LABORERS HEALTH AND WELFARE TRUST FUND.

FOR NORTHERN CALIFORNIA, ET AL., PETITIONERS

Vv.

ADVANCED LIGHTWEIGHT CONCRETE Co., INC.

ON PETITION FOR A WRIT OF CERTIORARI TO THit

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

BRIEF FOR THE UNITED STATES AS AMICUS CURIAE

CHARLES FRIED

Solicitor General

Lours R. COHEN

Deputy Solicitor General

GLEN D. NAGER

Assisiant to the Solicuor General

Department of Justice

Washington, D.C. 20530

GEORGE R. SALEM (202) 633-2217

Solicitor of Labor

ALLEN H. FELDMAN

Associate Solicitor

Caro. A. De Deo

Deputy Associate Solicitor

ELLEN L. BEARD

Attorney

Department of Labor

Washington, D.C. 20210

ROSEMARY M. COLLVER

General Counsel

National Labor Relations Board

Washineton, D.C. 20570

".

QUESTION PRESENTED

Whether a federal district court has jurisdiction under

Sections 502 and 515 of the Employee Retirement Income

Security Act of 1974, 29 U.S.C. 1132 and 1145, over an ac-

tion by the trustees of multiemployer employee benefit

plans to collect contributions from a delinquent employer,

where the employer’s alleged obligation to make contribu-

tions arises from its duty under Section 8(a)(5) of the Na-

tional Labor Relations Act, 29 U.S.C. 158(a)(5), to refrain

from unilaterally changing terms and conditions of

employment during post-contract expiration collective

bargaining.

(lt)

TABLE OF CONTENTS

TABLE OF AUTHORITIES

Cases:

American Distributing Co. v. NLRB, 715 F.2d 446 (9th

Cir. 1983), cert. denied, 466 U.S. 958 (1984) ..........

Carey v. Westinghouse Corp., 375 U.S. 261 (1964) ..._..

Cement Masons Health & Welfare Trust Fund \.

Kirk wood-Bly, Inc., 520 F.Supp. 942 (N.D. Cal. 1981),

aff'd, 692 F.2d 641 (Sth Cir. 19862) ..................

Central States, Southeast & Southwest Areas Pension

Fund .. Central Transport, Inc., No. 82-2157 (Juhe 19,

EE

Charles D. Bonanno Linen Service vy. NLRB, 454 U.S.

EL LEE

Commissioner v. Engle, 464 U.S. 206 (1984) ...........

Connell Construction Co. v. Plumbers & Steamfitters

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

Garner. Teamsters Union, 346 U.S. 485 (1953) ........

Hinson. NLRB, 428 F.2d 133 (8th Cir. 1970)... 2...

1.A.M. National Pension Trust Fund v. Schulze Tool &

Die Co., 564 F. Supp. 1285 (N.D. Cal. 1983) .......

Kaiser Steel Corp. v. Mullins, 455 U.S. 72 (1982)... ....

Laborers Health & Welfare Trust Fund v. Hess, 594 1.

EE ;

Local 20, Teamsters Union v. Morton, 377 U.S. 252

Ne cc cccrccces

Mo-Kan Teamsters Pension Fund \. Botsford Ready \Ii\

Co., 605 F. Supp. 1441 (W.D. Mo. 1985) ........ -

Moldovan \. Great Atlantic & Pacific Tea Co., 790 b.2d

NLRB. Amay Coal Co., 453 U.S. 322 (1981) |.

NLRB v. Lion Oil Co. , 382 U.S. 282 (1957) |

(111)

19

15

16, 17

9

IV

Cases — Continued: Page

Northern California District Council of Hod Carriers v.

Opinski, 673 F.2d 1074 (9h Cir. 1982) .............. 19

Pattern Makers’ Pension Trust Fund v. Badger Pattern

Works, Inc,, 615 F. Supp. 792 (N.D. Ill. 1985) ........ 6,19

San Diego Building Trades Council v. Garmon, 359 U.S.

DG “lccdenkandesiethneeesandndnesdeds 6. §

Smith vy. Evening News Ass’n, 371 U.S. 195 (1962) ...... 7

U.A. 198 Health & Welfare, Education & Pension Funds

v. Rester Refrigeration Service, Inc., 790 F.2d 423 (Sth

Se i nied ncddebandéeaussonsheweedaeds 19

United States vy. Utah Construction & Mining Co., 384

RO ee rr 1Y

Vaca v. Sipes, 386 U.S. 171 (1967)... 2.02, 7, 16, 18

Wisconsin Dep't of Industry, Labor & Human Rela-

tions v. Gould, No. 84-1484 (Feb. 26, 1986) .......... 16

Woodward Sand Co. v. Western Conference of Teamsters

Pension Trust Fund, 789 F.2d 691 (9th Cir. 1986)... .. 13

Statutes and regulations:

Employee Retirement Income Security Act of 1974,

29 U.S.C. (& Supp. Il) 1001 er seq.:

§ 203 bM IMG), 29 U.S.C. OSH bMINMG)....2...... 18

fp 4 8 tl EE ee a

§ S02(gM2), 29 U.S.C. 1132(gM2).... 2... 22... 10, 17

i ete eG ee ot passim

es CIN 6 vn cid ucéseuccevabse sas 10

es ED one Caged a bas need bes 10

§ 4201(ap(1), 29 U.S.C. 138Mayd) ................ 14

§§ 4201-4402, 29 U.S.C. (& Supp. I1l) 1381-1461 |. 10

§ 420} ap(l), 29 U.S.C. 138BHMapl)................ I4

§ 4212(a), 29 U.S.C. 13992(a) .................. 4, $, 12, 03

§ 4221(d), 29 U.S.C. MONG) ................ | 15

§ 4281(b), 29 U.S.C. 1450(b) ... 2... eee. 18

Labor-Management Relations Act of 1947, 29 U.S.C. 17]

et seq.:

a A ins GE oéccevocecvesees enn ae te Oe

- & | | | << Jere iedéese ) cae

Multiemployer Pension Plan Amendments Act of 1980,

Pub. L. No. 96-364, 94 Stat. 1208 er seg. ............. 4

Vv

Statutes and regulations — Continued: Page

A EGS sont ccévne dts rconanee sé 9, 15

es I as cdc ccctucet dsevesseeeded 9, 15

National Labor Relations Act, 29 U.S.C. 151 ef seq.:

6 Gaenede, BP UGC. CSRRMETD .. «cece cece 2G

DE, Bice GUEED 6 bc ccccscccccesseecs 7, 18

i eo ceca eeecasceeenes snes 18

> & . 5 | dl PPP OTTTTIS TET TTT 16

29 C.F.R.: .

ssa. kucehdbhebentesseetaceenenus O43 16

LD. «5-6 6.00 6606040666600 54 S66 Reree~ss 16

PE PERI occ cee es eeesrsteescectceasects 16

Miscellaneous:

126 Cong. Rec. (1980):

PE wENSCR Ceci eKecseccaccesseneneteasbeness 14

ake ne ane ey b 11, 12, 14, 17

Oh ME odie 0060660064 00068600 6t0 ere seeuescet 12, 14

SEE oc db benceeedvvesdacessesdccetes 14

Dep't of Labor Advisory Op. 78-28A (Dec. 5, 1978),

reprinted in Pens. Rep. (BNA) No, 221 (Jan. 8, 1979) . 1S

ERISA Improvements Act of 1978: Joint Hearings on

S. 3017 Before the Subcomm. on Labor and Human

Resources and the Subcomm. on Private Pension Plans

and Emplovee Fringe Benefits of the Senate Com.

on Finance, 951th Cong., 2d Sess. (1978)... 2... 6... 10

H.R. 3904, 96th Cong., Ist Sess. (1979), reprinted in

The Multiemplover Pension Plan Amendments Act of

1979, Hearines Before the Task Force on Welfare and

Pension Plans of the Subcomm. on Labor-Management

Relations of the House Comm. on Education and Labor

See Sate. DIR IT GHOOO 0 oc cece ciccccescccceces 13

C. Morris, The Developing Labor Law (1983) .......... 16

Multiemplover Pension Plan Amendments Act of 1979:

Hearines on S. 1076 Before the Senate Comm. on

Labor and Human Resources, 96th Cone., Is

ih, Cn << 646 bbe beenseeseseadsenne vent 10

Vi

Miscellaneous — Continued: Pave

Hearings on H.R. 3904 Before the Task Force on

Welfare and Pension Plans of the Subcomm. on

Labor-Management Relations of the House

Comm. on Education and Labor, 96th Cong., Ist

SE I lh Rh a le re ao nino 5 10, 14

Hearing on H.R. 3904 Before the House Comm. on

Ways and Means, 96th Cong., 2d Sess. (1980) .... 10

Multiemployer Pension Plan Termination insurance Pro-

gram: Hearing Before the Subcomm. on Oversight of

the House Comm. on Ways and Means, 96th Cong.,

PL cc acdeadednbakbaséeesustenasicees 10

Oversight of ERISA, 1977: Hearings on S. 2125 Before

the subcomm. on Labor of the Senate Comm. on

Human Resources, 95th Cong., Ist Sess. (1977) ....... 10

S. 1076, 96th Cong., Ist Sess. (1979), reprinted in

Multiemplover Pension Plan Amendments Act of 1979:

Hearings Before the Senate Comm. on Labor and

Human Resources, 96th Cong., Ist Sess. (1979)... ... 13

Staff of Senate Comm. on Labor and Human Resources,

96th Cong., 2d Sess., The Multiemplover Pension Plan

Amendments Act of 1980, S. 1076: Summary and

Anaivsis of Consideration (Comm. Print 1980) .11, 12, 13, 17

In the Supreme Court of the United States

OCTOBER TERM, 1986

No. 85-2079

LABORERS HEALTH AND WELFARE TRUST FUND,

FOR NORTHERN CALIFORNIA, ET AL., PETITIONERS

Vv.

ADVANCED LIGHTWEIGHT CONCRETE CO., INC.

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

BRIEF FOR THE UNITED STATES AS AMICUS CURIAE

This brief is submitted in response to the Court's order

inviting the Solicitor General to express the views of the

United States.

STATEMENT

1. Petitioners are multiemployer employee benefit

plans (Pet. 2). They were established by collective bargain-

ing agreements and trust agreements between the Northern

California District Council of Laborers and certain

multiemployer bargaining associations representing con-

struction industry employers in Northern California, and

between the District Council of Plasterers and Cement

Masons of Northern California and the same multi-

employer associations (ébid.). From at least 1980 to 1983,

respondent, Advanced Lightweight Concrete Company,

Inc., Was a member of one of these multiemployver bar-

gaining associations, Associated General Contractors ot

Calitornia (AGC), and thus was a party to AGC’S collec-

tive bargaining agreements with the two unions (id. at 2-3;

Pet. App. A2-A3). Those agreements required respondent

. (1)

2

to make specified monthly contributions to petitioners for

each hour that its covered employees worked (id. at A4).

By letter dated April 1, 1983, respondent notified the

unions that it was withdrawing bargaining authority from

AGC (Pet. 3; Pet. App. A4). Respondent indicated that it

was ready to negotiate independently with the unions (id.

at A4-AS5; Pet. 3), but that it would not be bound by

AGC’s master agreements, or any of its successor agree-

ments, after June 15, 1983, the expiration date of the ex-

tant agreements (Pet. App. A4). While the subsequent

bargaining history between respondent and the unions is

unclear (id. at AS & n.1), it is undisputed that respondent

did not enter into any new collective bargaining

agreements with the unions (id. at AS-A6) and ceased

making contributions to petitioners on June 15, 1983

(ibid.). In November 1983, the Regional Director of the

National Labor Relations Board (NLRB) refused to issue

a complaint based on a charge by one of the unions that

respondent had failed to bargain in good faith (id. at AS

n.1).

2. In December 1983, petitioners filed suit against re-

spondent in the United States District Court for the North-

ern District of California, seeking to collect unpaid con-

tributions for the period after June 15, 1983, while post-

contract expiration negotiations were pending (Pet. 3).

Petitioners alleged, inter alia, that respondent was bound

under Section 8(a)(5) of the National Labor Relations Act

(NLRA), 29 U.S.C. 158(a)(5), to honor during that period

the contribution obligations established by the expired col-

lective bargaining agreements, and that the court had

jurisdiction under Section 301 of the Labor-Management

Relations Act of 1947 (LMRA), 29 U.S.C. 185, and Sec-

tions 502 and SiS of the Employee Retirement Income

Security Act of 1974 (ERISA), 29 U.S.C. 1132, 1145, to

enforce this obligation (Pet. App. A6-A7; Pet. 3). Re-

spondent answered, inter alia, that any obligation it mighi

3

have under the NLRA was not within the jurisdiction of

the district court and that, in any event, its negotiations

with the unions were at “impasse” and it therefore had no

NLRA-based contribution obligation (Br. in Opp. 2 n.1,

3). The court granted summary judgment for respondent,

relying on Cement Masons Health & Welfare Trust Fund

v. Kirkwood-Bly, Inc., 520 F. Supp. 942 (N.D. Cal. 1981),

aff'd for the reasons stated in the district court’s opin-

ion, 692 F.2d 641 (9th Cir. 1982). Pet. App. A7-A8; Pet.

App. B.

3. The court of appeals affirmed on the ground that

the district court had no jurisdiction under either Section

301 or ERISA (Pet. App. Al-A36). It acknowledged that

“an employer’s failure to honor the terms aad conditions

of an expired collective bargaining agreement pending

negotiations on a new agreement constitutes bad taith

bargaining in breach of sections 8(a)(1), 8(a(S) and 8d) of

the [NLRA]” (Pet. App. A9-A10). But, it said, “a collec-

tive bargaining agreement does not ‘survive’ [its expira-

tion] in the sense that it continues as a legally operative

document” (id. at Al2). Rather, the court said, “the agree-

ment’s terms ‘survive’ in order to define the parameters of

the employer's obligation under section 8(a)(5) to maintain

the status quo during negotiations” (/bid.). Accordingly,

the court found that respondent was entitled to “summary

judgment on the trust funds’ section 301-based causes of

action” (Pet. App. Al6), since petitioners’ sum sought to

enforce rights created by the NLRA and not rights created

by a collective bargaining agreement (id. at Al2-Al3,

Al6).

The court then turned to the question whether the

district court had jurisdiction under Sections 502 and 515

of ERISA to enforce respondent’s alleged NLRA-based

post-contract expiration contribution obligation (Pet.

App. Al6-A31). The court noted that Section 502 conters

jurisdiction on the district courts to enforce obligations

4

arising under Section 515 (Pet. App. Al7 n.7) and that

Section 515 requires an employer “ ‘who is obligated to

make contributions to a multiemployer plan * * * under

the terms of a collectively bargained agreement [to] * * *

make such contributions in accordance with the terms and

conditions of * * * such agreement’” (Pet. App. Al6,

quoting 29 U.S.C. 1145).' The court further noted that “a

phrase similar to ‘obligated to make contributions,’ which

appears in section 515, is defined elsewhere in [Section

4212(a) of] ERISA as ‘an obligation to contribute arising

*** (1) under one or more collective bargaining (or

related) agreements, or (2) as a result of a duty under ap-

plicable labor-management relations law’ ” (id. at A2l

(quoting 29 U.S.C. 1392(a)), and that “[sJubpart 2 of this

definition would seem to include obligations created by

section 8(aX(5)" of the NLRA (ibid.)). But the court ob-

served that Section 4212(a)’s definition of “obligation to

contribute” is applicable only to the part of ERISA that

imposes liabiluy on employers upon withdrawal trom

multiemployer pension plans (Pet. App. A21-A22)° and

said that “the similarity between the phraseology in section

' Section 515 of ERISA, 29 U.S.C. 1145, provides that:

Every employer who is obligated to make contributions to a

multiiemployer plan under the terms of the plan or under the

terms of a collectively bargamed agreemem shall, to the esicnt

not meconsistent with law, make such contributions m accordance

with the terms and conditions of such plan of such agreement

> Section 4212(a) of ERISA, 29 U.S.C. 1399214), provides that

For purposes of this part, the term “obligation to contribute”

means an obligation to contribute arising —

(1) ender one or more collective bargaining tor related)

agreements, or

(2) as a result of a duty under applicable labor -managemen

relations law, but

does not include an obligation to pay withdrawal bhatminy ander

this section of to pas delinquent contributions

5

$15 and that in [the first subpart of the Section 4212(a)

definition indicates] * * * that Congress intended section

$15 liability to be less extensive than withdrawal liability”

(id. at A23-A24). Finally, the court found “[njo indication

* * * that, during its deliberations * * *, Congress even

considered the problem of continuing obligations from ex-

pired agreements much less tha(t] it had a view on resolv-

ing any conflict between section 515 and the primary

jurisdiction of the NLRB” (id. at A25-A26 (footnote

omitted)).

In the absence of “useful statutory or Congressional

guidance on section 515” (Pet. App. A31), the court con-

cluded that “the matter [had to] be decided by the applica-

tion of accepted labor law principles” (/bid.). The court

then said that, “{wJhen presented with a dispute that in-

volves adjudicating conduct which ‘is arguably within the

compass of [Section] 7 or [Section] 8 of the NLRA,’ a

federal court must defer to the primary jurisdiction of the

NLRB” (id. at A31-A32 (quoting San Diego Building

Trades Council v. Garmon, 359 U.S. 236, 245 (1959)). Ap-

plying this principle, the court determined that respond-

ent’s “failure to pay contributions after the master

agreements’ expiration is, at least, an arguable unfair

labor practice” (Pet. App. A33); that, “[w}hile admittedly

the failure to pay may also violate section 515 of ERISA,

adjudication of the merits depends entirely on the section

8(a)S) determination” (id. at A33-A34); and that “(mjak-

ing this underlying labor law determination is exclusively

an NLRB matter” (id. at A34 (footnote omitted)). Accord-

ingly, having found “no persuasive evidence in either the

plain words or legislative history of ERISA * * * that

Congress intended section $15 to be an exception to the

general rule of NLRB preemption” (id. at A35-A36), the

court held that “the primary jurisdiction of the [NLRB]

preempts [petitioners’] * * * suit in district court under

6

sections 502 and 515 of [ERISA] to recover delinqueni

contributions accrued after a collective bargaining agree-

ment has expired” (id. at A2).

DISCUSSION

Petitioners comtend that Section $02 and 515 of ERISA

give the district court jurisdiction over their action to col-

lect contributions from respondent, where respondent's

alleged obligation to contribute arises from its duty under

the NLRA to refrain from unilaterally changing terms and

conditions of employment during post-contract expiration

collective bargaining.’ This question is of immense prac-

tical importance to the administration and solvency o!

multiemployer employee benefit plans, and we believe the

courts below erred im ruling that the district court lacked

jurisdiction. Accordingly, we submit that the question

warrants review by the Court at this time.

1. We start with the conclusion of the court of appeals

that “the primary jurisdiction of the [NLRB] preempt»

[petitioners’) suit in district court under sections 502 and

515 of [ERISA] to recover delinquent contributions ac-

crued after [the] collective bargaining agreement(s| ha[d]

expired” (Pet. App. A2). We agree with the court that “[re-

spondent’s} failure to pay contributions after the master

agreements’ expiration [was], at least, an arguable untan

labor practice” (/d. at A33) and that “adjudication of the

merits fof petitioners’ claims] depends entirely on the sex

' Petitioners do not appear to contend in this Court that ember th

expired collective bargainmg agreements or the pension plon

documents require respondent to make such post-contract exsprrarion

comributions. Ct. Pattern Makers’ Pension Trust bunds. Badeer Pur

tern Works, Inc., 615 F. Supp. 792 (N.D. TN. 1985) Cliduecary may on

force terms of pension plan against employer even though colleen

bargaining agreemem has expired)

7

tion 8(aX(5) determination” (id. at A34). We do pot agree,

however, that “this underlying labor law determination is

exclusively an NLRB matter” (ibid.).

This Court has previously recognized that Congress has

granted federal courts jurisdiction in certain circumstances

to adjudicate NLRA-based rights. See Kaiser Steel Corp.

v. Mullins, 455 U.S. 72, 83-86 (1982); Connell Consiruc-

tion Co. v. Plumbers & Steam/fitters Local Union No. 100,

421 U.S. 616, 635 n.17 (1975). In Local 20, Teamsters

Union v. Morton, 377 U.S. 252 (1964), the Court held

that, in Section 303 of the LMRA (29 U.S.C. 187), Con-

gress authorized the federal courts to award damages to

any person injured by a violation of Section 8(b)4) of the

NLRA (29 U.S.C. 158(b)(4)), even though the NLRB has

concurrent jurisdiction to remedy such untair labor prac-

tices. Similarly, in Smith v. Evening News Ass'n, 371 U.S.

195, 197 (1962), the Court found that “[t}he authority of

the [NLRB] to deal with an unfair labor practice which

also violates a collective bargaining agreement is not

displaced by [Section] 301 [of the LMRA}, but it is not ex-

clusive and does not destroy the jurisdiction of the courts

in suits under [Section] 301.” See also Vaca v. Sipes, 386

U.S. 171 (1967) (federal court may adjudicate duty of fair

representation claim in a suit under Section 301 of the

LMRA even though the NLRB has concurrent jurisdiction

under the NLRA to adjudicate such a claim). These cases

show that federa! courts in fact have jurisdiction to decide

unfair labor practice questions “where it cannot) be in-

ferred that Congress intended exclusive jurisdiction to lie

with the NI RB” (386 U.S. at 179).

This case presents the que © »n whether, in Sections 502

and $15 of ERISA, Congress grammed tederal courts

jurisdiction to enforce an obligation to make contribu.

tions to a pension fund where the source of that obligation

is the NLRA. While neither the test nor the legislative

history of these sections speaks directly to this question,

we believe that the better reading of the sections is that

they confer such jurisdiction, including, in this instance,

the power to decide whether respondent unilaterally

changed terms and conditions of employment prior to

reaching “impasse” in its negotiations with the unions, in

violation of Section 8(aX(S) of the NLRA.

2. Section 502 of ERISA gives federal district courts

juridiction over, inter alia, civil actions by plan fiduciaries

to enjoin violations of Subchapter I of ERISA, to redress

such violations, and to enforce the provisions of Sub-

chapter |. Section 515 is part of Subchapter | of ERISA.

See 29 U.S.C. 1145. The question, therefore, is whether

Section 515 covers an employer's obligation under Section

8(a(S) of the NLRA to continue to make contributions to

the plan, in accordance with the terms of an expired agree-

ment, during post-contract expiration collective bargain.

ing.

a. Section S15 states that “[ejvery employer who is

obligated to make contributions to a multiemployer plan

under the terms of the plan or under the terms of a collec-

tively bargained agreement shall, to the extent not incon-

sistent with law, make such contributions in accordance

with the terms and conditions of such plan or such agree-

ment” (29 U.S.C. 1145). But the phrase “obligated to

make contributions * * * under the terms of a collectively

bargained agreement” is ambiguous. The phrase could be

read to refer only to contribution obligations that arise

trom the collective bargaining agreement itsell. See Vo-

Kan Teamsters Pension Funds. Botsford Ready Mix Co.,

605 F. Supp. 1441, 1444-1446 (W.D. Mo. 1985). On the

other hand, the phrase may refer to any contribution

obligation that is detined by “rhe terms of a collectively

bargained agreement.” On that view, Section S15 would

encompass an NLRA-based contribution obligation, since

that obligation would be defined by “the terms of a collec.

uvely bargained agreement.” See Laborers Health &

Welfare Trust Fund vy. Hess, $94 F. Supp. 273, 279-280

(N.D. Cal. 1984); see generally American Distributing Co.

v. NLRB, 715 F.2d 446, 452 (9th Cir. 1983), cert. demed,

466 U.S. 958 (1984) (emphasis added) (under the NLRA,

“an employer is required to maintain the status quo and

make payments in conformity with the terms of an expired

written agreement’), Hinson v. NLRB, 428 F.2d 133, 139

(8th Cir. 1970) (emphasis added) (“[s}ince the status quo is

quite obviously defined by reference to the substantive

terms of the expired contract, it follows that, in a limited

and special sense, those pertinent contractual terms ‘sur-

vive’ the expiration date”).

Where more than one interpretation of statutory

language is plausible, this Court has said that u will search

for the “ ‘interpretation which can most fairly be said to be

imbedded in the statute, in the sense of being most har-

monious with its scheme and with the general purposes

that Congress manifested’ ” (Commissioner v. Engle, 464

U.S. 206, 217 (1984), quoting NLRB v. Lion Ot Co., 352

U.S. 282, 297 (1957) (Frankfurter, J., concurring im part

and dissenting in part)). Accordingly, to determine

whether Congress intended to make NLRA-based con-

tribution obligations independently enforceable in direct,

ERISA-based, federal court actions, we turn to the cir-

cumstances surrounding Section S$15"s enactment and to

the place that Section S15 has in the overall ERISA

scheme.

b. Congress enacted Section SIS as part of the

Multiemplover Pension Plan Amendments Act of 1980

(MPPAA), Pub. .. No. 96-364, 94 Stat. 1208 ef sey. In

MPPAA, Congress attempted to address comprehensively

the “problems which tend to discourage the maimicnance

and growth of multiemployer pension plans” (29 U.S.C.

1001aicK 2), and “to provide reasonable protection tor the

interests of participants and beneficiaries of ftnanctally

distressed muliemployer pension plans” (29° U.S.C,

1OOlaichK 3). To that end, Congress revised the system by

lection of both delinquent contributions and withdrawal

liabilities. See 29 U.S.C. 1132(gX(2), 1145, 1322a-1322b; 29

U.S.C. (& Supp. 1) 1381-1461. Section 515 is the en-

forcement mechanism that Congress created to facilitate

* See, ¢.g., Oversight of ERISA, 1977: Hearings on S. 2125 Before

the Subcomm. on Labor of the Senate Comm. on Human Resources.

95th Cong., Ist Sess. 391-394 (1977), ERISA Improvements Act o/

1978 Jount Hearings on S. 3017 Before the Subcomm. on Labor and

Human Resources and the Subcomm. on Private Pension Plans and

Emplovee Fringe Benefits of the Senate Comm on Finance, 9th

Cong., 2d Sess. 123 (1978); Mudnemplover Pension Plan Amendments

Act of 197% Hearings on S. 1076 Before the Senate Comm. on Labor

and Human Resources, Mth Cong. Is Sess. $23 (1979:

Mudnemplover Pension Pian Termination Insurance Program Heer

ine Before The Subcomm. on Oversight of the House Comm. on

Wevs end Means, Mth Cong., Ist Sess. 121-122 (97H, The

Mudnemplover Pension Plan Amendments Act of 19°79. Hearimes on

H_R. 3904 Before the Task Force on Welfare and Pension Plans of the

Swhcomm. on Labor-Management Relations of the House Comm on

Education end Labor, %th Cong., Ist Sess. 772, 808 (1979, The

Muinemplover Pension Pian Amendments Act of 1979 Hearme on

HR. 3904 Before the House Comm. on Wars and Means, 9h

Cong., 2d Sess. 193 (1980)

study, Congress learned that, where delinquencies occur,

plans lose investment income, incur increased ad-

ministrative expenses (for detecting and collecting delin-

quencies), have greater difficulty formulating and meeting

funding standards, and must require nondelinquent

employers to fund the pensions of delinquent employers’

employees. See 126 Cong. Rec. 23039 (1980) (remarks of

Rep. Thompson); Staff of the Senate Comm. on Labor

and Human Resources, 96th Cong., 2d Sess., The

Multiemployver Pension Plan Amendments Act of 1980, S.

1076: Summary and Analysis of Consideration 43-44

(Comm. Print. 1980) [hereinafter cited as Comm. Print).°

Moreover, Congress found that “[rjecourse available

under current law for collecting delinquent contributions

is insufficient and unnecessarily cumbersome and costly”

(126 Cong. Rec. 23039 (1980) (remarks of Rep. Thomp-

son)).° Thus, those who proposed and supported Section

§15’s enactment described it as a mechanism that would

“rermit trustees to recover delinquent contributions ef-

‘The Staff of the Senate Committee on Labor and Human

Resources explained that:

Delinquencies of employers in making required contributions

are a serious problem for most multiemployer plans. Failure of

employers to make promised contributions in a timely tashion

imposes 4 variety of costs on plans. While contributions remain

unpaid, the plan loses the benefit of investment income that could

have been carned if the past due amounts had been rece ed and

invested on time. Moreover, additional administrative costs are

incurred in detecting and collecting delinquencies. Attorneys tees

and other legal costs arise in connection with collection cllorts.

Comm. Print 43-44.

The Stal! of the Senate Commitice on Labor and Human

Resources explained that “[sJome simple collection actions brought by

plan trustees have been converted into lengthy, costly and comples

litigation concerning claims and detenses unrelated to the employ er’s

promise and the plans’ entitlement to the contributions” (Comin Print

44).

12

ficaciously” (id. at 23288 (remarks of Sen. Williams)),

“foster the preservation of the private multiemployer plan

system *** [by] discourag{ing] delinquencies and

simplify{ing] delinquency collection” (Comm. Print 44),

and “clarify the law * * * by providing a direct, unam-

biguous ERISA cause of action to a plan against a delin-

quent employer” (126 Cong. Rec. 23039 (1980) (remarks

of Rep. Thompson)).

Nothing in the legislative history of MPPAA indicates

that Congress intended to limit the provisions of Section

$15 to the enforcement of contractually based contribu-

tion obligations. Nor does the legislative history indicate

that Congress intended to require trustees to recover pre-

contract expiration and post-contract expiration delin-

quencies in different forums. Rather, the comments in the

legislative history, while not speaking directly to the pres-

ent issue, suggest an intention to provide plan trustees with

a single, efficient cause-of-action for collecting all delin-

quent contributions, whatever the source of the obligation

to contribute or the timing of the delinquency. See, ¢.¢.,

126 Cong. Rec. 23039 (1980) (remarks of Rep.

Thompson); id. at 23288 (remarks of Sen. Williams).

c. Our belief that Section 515 was intended to cover

NLRA-based contribution obligations is fortified by the

definition of “obligation to contribute” that appears in

Section 4212(a) of ERISA. Section 4212(a) provides that

an employer has an “obligation to contribute” when it has

“an obligation to contribute arising (1) under one or more

collective bargaining (or related) agreements, or (2) as a

result of a duty under applicable labor-management rela-

tions law * * *"(29 U.S.C. 1392(a)). As a result of the see-

ond clause of Section 4212(a), arbitrators and courts mak-

ing withdrawal liability determinations plainly are te-

quired to take into account an employer's continuing

NLRA-based contribution obligation (and are thus re

quired to address the underlying Section 8(a)(5) question).

ee

13

See Comm. Print 12-14; Woodward Sand Co. v. Western

Conference of Teamsters Pension Trust Fund, 789 F.2d

691, 695 (%h Cir. 1986) (remanding for determination

whether parties reached “impasse” before or after the ef-

fective date of MPPAA withdrawal liability provisions);

1.A.M. National Pension Trust Fund v. Schulze Tool &

Die Co., 564 F. Supp. 1285, 1289-1296 (N.D. Cal. 1983)

(court must decide “impasse” question in resolving

withdrawal liability issue). The definition of “obligation to

contribute” that appears in Section 4212(a) expressly ap-

plies only “[flor purposes of [the withdrawal liability]

part” of ERISA (29 U.S.C. 1392(a)). That definition may

therefore “not apply elsewhere in the Act [by its] own

force” (Nachman Corp. v. Pension Benefit Guaranty

Corp., 446 U.S. 359, 370 n.14 (1980)). But that definition

“may otherwise reflect the meaning of the term[] defined

as used in other Titles” of ERISA (ibid.). Because the

delinquent contribution and withdrawal liability provi-

sions were enacted at the same time and play complemen-

tary roles in the MPPAA scheme, we believe the better

reading is that the term “obligated to make contributions,”

which appears in Section 515, has a meaning comparable

to the phrase “obligation to contribute,” which appears in

Section 421 2(a).’

’ The legislative history of the two provisions nenher continms nor

refutes the poins. The withdrawal liability provisions were introduced

simultaneously in both houses of Congress on May 3, 1979. See H.R.

3904, 96th Cong., Ist Sess. (1979), reprinted in The Multiemplover

Pension Plan Amendments Act of 1979: Hearings Before the Task

Force on Welfare and Pension Plans of the Subcomm. on Labor-

Management Relations of the House Comm. on Education and

Labor, 96th Cong., Ist Sess. 3 (1979); S. 1076, 96th Cong., Ist Sess.

(1979), reprinted in Multiemplover Pension Plan Amendments Act of

1979: Hearines Before the Senate Comm. on Labor and Human

Resources, 9h Cong., Ist Sess. 3 (1979). Neither bill contamed a pro-

vision concerning delinquent employer contributions. See S. 1076,

96th Cong., Ist Sess. (1979); H.R. 3904, 96th Cong., Ist Sess. (1979).

14

In enacting MPPAA, Congress was particularly con-

cerned that employers not escape their obligation to fund )

the pensions that multiemployer plans would be liable to |

pay the employers’ employees. See 126 Cong. Rec. 23288

(1980) (remarks of Sen. Williams); id. at 23039 (remarks

of Rep. Thompson); jd. at 20180 (colloquy between Sen.

Williams and Sen. Matsunaga). Accordingly, in Section

515, the delinquent contribution provision, Congress man-

dated that, when an employer has become “obligated to |

make contributions,” it “shall, to the extent not inconsis- |

tent with law, make such contributions in accordance with

the terms and conditions of such plan * * *.” Con-

comitantly, in the withdrawal liability provisions, Con-

gress mandated that, when an employer “withdraws trom

a multiemployer plan in a complete withdrawal[,] * * * the

employer [shall be] liable to the plan” for a portion of the

plan’s unfunded vested benefits such that the burden of its

employees’ pensions will not fall on the remaining

employers or plan beneficiaries (29 U.S.C. 1381(a)(1)).

Importantly, Congress provided that a “complete with-

drawal” would be deemed to occur only when the

employer has “permanently cease[d] to have an obligation

to contribute under the plan” (29 U.S.C. 1383(a)(1)).

Applying different definitions to the contribution

obligations identified in the delinquent contribution and

withdrawal liability provisions would leave an unwar-

ranted gap in this “comprehensive and reticulated” scheme

The provision for delinquent contributions was added later by Hoo

leaders in both houses. 126 Cong. Rec. 23039 (1980); i. at 23288. The

legislative history does not directly discuss the connection between thy )

delinquemt contribution and withdrawal liability provisions, except to .

state that they should be enforced in the same manner. See //h

Multiemplover Pension Plan Amendments Act of 1979: Hearings on

H.R. 3904 Before the Task Force on Welfare and Pension Plans of thy

Subcomm. on Labor-Management Relations of the House Comm. on

Education and Labor, 96th Cong., Ist Sess. 808 (1979), 126 Cony

Rec. 23039 (1980); fd. at 23288-23289.

ee |

15

(Nachman Corp. v. Pension Benefit Guaranty Corp., 446

U.S. at 361). ERISA would provide plan trustees with an

independent means for enforcing an employer's obliga-

tions arising during the term of the underlying collective

bargaining agreement and for enforcing an employer's

obligation to pay withdrawal liability, but ERISA would

not provide plan trustees with an independent means for

enforcing an employer's obligation to fund its employees’

pensions between the expiration date of the employer's

collective bargaining agreement and the date of the

employer’s complete withdrawal from the plan, even

though the employer would have such an obligation and

even though ERISA would require plan trustees to credit

all employee service performed during that period. See 29

U.S.C. 10S bM1 MG) (“all of an emoloyee’s years of serv-

ice with the employer or employers maintaining the plan

Shall be taken into account”); Cenrra/ States, Southeast &

Southwest Areas Pension Fundy. Central Transport, Inc.,

No. 82-2157 (June 19, 1985), slip op. 6-7 n.7 (quoting

Dep't of Labor Advisory Op. 78-28A (Dec. 5, 1978),

reprinted in Pens. Rep. (BNA) No. 221, at R-25 (lan. 8,

1979)). We tind no evidence that Congress intended to

leave such a gap in the provisions it enacted specitically to

address the many “problems which tend to discourage the

maintenance and growth of multiemployer pension plans”

and to “provide reasonable protection tor the interests of

participants and beneticiaries of financially distressed

multiemplover pension plans” (29 U.S.C. l0OlatcK2) and

(3))."

* lo the contrary, we note that Congress provided that, tor pur-

poses of tederal court enforcement, the delinquent contribution and

withdrawal habits provisions should be “treated un the same manner”

(29U.S.C. 148 10d). See also 29 U.S.C. 14010) (or the emmplover tanks

to make timely payment in accordance with such tinal decision, the

emplover shall be treated as being dehnquent ta the making of a con-

tribution required under the plan (within the m@eanme of sccthon 1145

ot this ttle)

16

d. To be sure, the trustees could file a charge with the

NLRB seeking to recover delinquent contributions in that

forum. But we do not believe that Congress intended

trustees to have only this limited recourse.

The NLRA enforcement scheme is designed to facilitate

the resolution of labor disputes, not the collection of

delinquent contributions. The NLRA, for example, vests

the NLRB’s General Counsel with “unreviewable discre-

tion to refuse to institute an unfair labor practice com-

plaint.” Vaca v. Sipes, 386 U.S. at 182. Thus, requiring

multiemployer pension plan trustees to resort to the NLRB

may, in some circumstances, mean that they have no

recourse for collecting delinquencies at all. Moreover,

even where the General Counse! issues an untair labor

practice complaint, the NLRB does not allow interested

third parties such as plan trustees to obtain discovery. See

C. Morris, The Developing Labor Law 1625 (1983). In ad-

dition, the NLRA authorizes the General Counsel and

NLRB to settle unfair labor practice charges without ob-

taining the charging party's consent and for less than

“make-whole” relief. See 29 U.S.C. 160(c); 29 C.F.R.

101.2, 101.4, 101.9%c). Thus, the trustees’ interest in fully

collecting all contributions owed to a pension plan may be

compromised. Cf. NLRB v. Amax Coal Co., 453 U.S.

322, 337 (1981) (trustees have “obligation to entorce the

terms of the collective bargaining agreement regarding

employee fund contributions against the employer for the

sole benetit of the beneficiaries of the fund”). Finally, the

NLRB cannot impose any type of punitive sanction. See

Wisconsin Dep't of Industry, Labor & Human Retations

v. Gould, No. 84-1484 (Feb. 26, 1986), slip op. 5-6 & n.5.

it therefore has only a limited ability to deter employers

from becoming delinquent in the first place.

In contrast, the ERISA enforcement scheme ts spectall)

designed to “foster the preservation of the private

multiemployer plan system * * * [by] discourag|ing]} delin-

17

quencies and simplifyfing] dehnquency collection”

(Comm. Print 44). Section 515 provides trustees with a

direct, unambiguous cause-of-action for collecting delin-

quencies. The trustees have exclusive control over the ac-

tion and thus no third party can compromise their interest

in collecting all contributions owed toa plan. See NLRB v.

Amax Coal Co., 453 U.S. at 336. Moreover, liberal rules

of discovery govern the action and provide trustees with a

means for determining whether and (o what extent con-

tributions are actually owing and delinquent. Finally, Sec-

tion $02(22) of ERISA requires courts, where trustees are

victorious, to award reasonable attorney's tees, costs, un-

paid contributions, interest on the unpaid contributions,

and an additional amount equal to the greater of interest

or specified liquidated damages. See 29 U.S.C. 1132(¢¢)(2).

Thus, the ERISA enforcement scheme adds some impor-

tant muscle to the trustees’ struggle against delinquent

contributors and delinquent contributions.

When Congress created this special entorcement

scheme, it stated that “recourse available under current

law for collecting delinquent contributions [was] msuffi-

cient and unnecessarily cumbersome and costly” (126

Cong. Rec. 23039 (1980) (remarks of Rep. Thompson)).

NLRB entorcement proceedings were part of the then-

available recourse. Accordingly, we do not believe that

Congress intended to require plan trustees to resort to the

NLRB tor entorcement of NLRA-based contribution

obligations. Rather, Congress presumably expected that

Section 515 would cover these obligations as well.

3. Ahhough its opinion is not altogether clear on the

point (compare Pet. App. A21-A26 with A26 n.12 and

A33-A34), ithe court below at one point acknowledyved that

“the failure to pay may also violate section 515 of ERISA”

(id. at A33). lt tound, however, that the language and

legislative history of Section SIS are sutficiently am-

biguous to require that its interpretation be resolved by

18

reference to “accepted labor law principles,” specitically,

the principle that the NLRB has primary jurisdiction to

resolve unfair labor practice questions. See Pet. App.

A31-A32. We do not think that the question of Congress's

intent under Section 515 can be resolved in this fashion.

As a general rule, of course, the NLRA does vest the’

NLRB with primary jurisdiction to decide unfair labor

practice questions. “Congress * * * considered that cen-

tralized administration of specially designed procedures

was necessary to obtain uniform application of [the

NLRA’s] substantive rules and to avoid th[o]se diversities

and conflicts likely to result from a variety of local pro-

cedures and attitudes toward labor controversies” (Garner

v. Teamsters Union, 346 U.S. 485, 490 (1953)). As we

noted above, however, Congress has occasionally deter-

mined that this concern for uniformity of decision should

yield to other considerations and, in such situations, has

established independent mechanisms for enforcing par-

ticular NLRA-based rights. See, e.g., Local 20, Teamsters

Union v. Morton, 377 U.S. 252 (1964) (29 U.S.C. 187

creates an independent basis for enforcing the prohibitions

set forth in Section 8(b)(4) of the NLRA); Vaca v. Sipes,

386 U.S. 171 (1967) (29 U.S.C. 185 creates an independent

basis for enforcing the duty of fair representation em-

bodied ‘in Section 9(a) of the NLRA, 29 U.S.C. 159(a)).

Thus, reference to general primary jurisdiction rules mere-

ly begs the question whether “Congress intended exclusive

jurisdiction to lie with the NLRB” (Vaca v. Sipes, 386 U.S.

at 179). Rather, the question whether the concern for

uniformity of decision should yield to other considerations

must be determined by reference to the language,

legislative history, and purposes of the federal statute

alleged to create the independent enforcement

mechanism —in this instance, Section 515 of ERISA.”

¥ Ordinarily, of course, “assessing the significance of Impasse and

the dynamics of collective bargaining is precisely the kind of judgment

19

4. In our view, the language, legislative history, and

purposes of Section 515 of ERISA compel the conclusion

that Congress created an independent mechanism for en-

forcing contribution obligations arising out of the NLRA-

based duty to refrain from unilaterally changing terms and

conditions of employment during post-contract expiration

collective bargaining. The court below is not alone,

however, in reaching a contrary judgment. See, e.g.,

Moldovan v. Great Atlantic & Pacific Tea Co., 790 F.2d

894 (3d Cir. 1986); U.A. 198 Health & Welfare, Education

& Pension Funds v. Rester Refrigeration Service, Inc., 790

F.2d 423 (Sth Cir. 1986); Mo-Kan Teamsters Pension

Fund v. Botsford Ready Mix Co., 605 F. Supp. 1441

(W.D. Mo. 1985); Pattern Makers’ Pension Trust Fund v.

Badger Pattern Works, Inc., 615 F. Supp. 792 (N.D. Il.

1985); but see Laborers Health & Welfare Trust Fund v.

Hess, 594 F. Supp. 273 (N.D. Cal. 1984). These decisions

spell serious adverse consequences for the financial stabili-

ty of multiemployer plans, which are as adversely affected

by post-contract expiration delinquencies as they are by

pre-contract expiration delinquencies. Given the congres-

sional interest reflected in MPPAA in maintaining the

that * * * should be left to the Board” (Charles D. Bonanno Linen

Service v. NLRB, 454 U.S. 404, 413 (1982)). Accordingly, a federal

court ordinarily should refrain from deciding any “impasse” question

that is pending before the NLRB. See Northern California District

Council of Hod Carriers v. Opinski, 673 F.2d 1074, 1075-1076 (9th

Cir. 1982). Thus, if the General Counsel has issued a complaint con-

cerning a bad faith bargaining charge filed by either the trustees of a

plan or a union, a federal court concurrently considering a Section 515

enforcement action by the trustees should presumably refrain from

deciding the impasse issue and await that issue’s resolution by the

NLRB. The NLRB decision would be binding in the trustees’ federal

court action, provided that the trustees had an adequate opportunity

to litigate the issue in the NLRB proceeding. See Curey v.

Westinghouse Corp., 375 U.S. 261, 272 (1964); United States v. Utah

Construction & Mining Co., 384 U.S. 394, 421-422 (1966).

20

financial health of multiemployer plans, we believe that

the question whether trustees may enforce NLRA-based

contribution obligations in federal court deserves the im-

mediate attention of this Court.

CONCLUSION

The petition for a writ of certiorari should be granted.

Respectfully submitted.

CHARLES FRIED

Solicitor General

Louis R. COHEN

Deputy Solicitor General

GLEN D. NAGER

Assistant to the Solicitor General

GEORGE R. SALEM

Solicitor of Labor

ALLEN H. FELDMAN

Associate Solicitor

CAROL A. DE DEO

Deputy Associate Solicitor

ELLEN L. BEARD

Altorney

Department of Labor

ROSEMARY M. COLLYER

General Counsel

National Labor Relations Board

JANUARY 1987

US GOVERNMENT PRINTING OFFICE 19867— 181.483 4019-