Appendix — Building & Constr. Trades Council v. Associated Builders & Contractors of Massachusetts/Rhode Island, Inc.

Supreme Court brief1993

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Text

QO” ~~ FILE

4° 91-26) ” "

IN THE

Supreme Court of the United States

OCTOBER TERM, 1991

OFFIGE OF THE CLERK

BUILDING AND CONSTRUCTION TRADES COUNCIL

OF THE METROPOLITAN DISTRICT

Pe filione r,

ASSOCIATED BUILDERS AND CONTRACTORS OF

MASSACHUSETTS / RHODE ISLAND, INC., et al.,

Re sponde nts.

Petition for a Writ of Certiorari to the

United States Court of Appeals

for the First Circuit

APPENDIX TO

PETITION FOR A WRIT OF CERTIORARI

LAURENCE J. COHEN

VICTORIA L. Bor

1125 15th Street, N.W

Washington, D.C. 20005

DONALD J. SIEGE!

MARY T. SULLIVAN

11 Beacon Street

Boston, MA 02108

WALTER KAMIA1

LAURENCE GOLD

(Counsel of Record)

815 L6th Street, N.W

Washington, D.C. 20006

(202) 637-5390

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APPENDIX A

U.S. COURT OF APPEALS

IRCUIT (BOSTON

No. 90-1392

ASSOCIATED BUILDERS AND CONTRACTORS OF

et al.

'Ts/ RHODE ISLAND, INC..

LASSACHUS

May 15, 1991

Un wpe t10n Io) rehe irl! yen bane of 135 LRRM 2713.

on granted, underlying order of the U.S. District

rt for the District of Massachusetts reversed, and

tter ren anded.

See also 186 LRRM 2994.

Maurice Jaskin (Carol Chandler. Mary L. Marshall,

Chandler & Miller, Thomas J. Madden. and

Howard & Civiletti, with him on

: . ;

ipile, Baetier.

lames J. Kelley and John M. Stevens (E. Carl Uehlein,

Jr., Morgan, Lewis & Bockius, Arthur G. Telegen, Foley

Hoag & Eliot, Catherine L. Farrell, General Counsel, and

Virginia S. Renick, Senior Staff Counsel, on joint brief

r appellees Kaiser Engineers, Inc. and MWRA.

Donald J. Siegel (Mary T. Sullivan, Segal, Roitman &

Coleman, Laurence J. Cohen, Victoria L. Bor, Sherman,

Walter Kamiat, and

Dunn, Cohen, Leifer & Yellig,

cAliis

TORRUELLA, Circuit Judge Plaintiffs-Appe !

\ ‘ ed Build nd Contracto f Massachuset

Rhode Island, lh A Be appeal the de of the

United States D ct Court f he D f Ma

chuset lenying AB reque for a prelimina) njune

ay, Oy he ¢ ed belov we reve e this deci-

ion and remand for act consistent with our opinio1

I THE FACTS

The Massachusetts Water Resources Authority

(“MWRA”) is a governmental agency authorized by tl

Massachusetts legislature to provide water supply serv-

1 Also its national a ciation and five

individual contractors.

ices, sewage collection, and treatment and disposal serv-

ices for the eastern half of Massachusetts. Following a

lawsult arising out of its failure to prevent the pollution

of Boston Harbor. United States v. Me tropolitan District

Commission, C.A. No. 85-0489-MA (Mazzone, J.), the

MWRA was ordered to meet a detailed timetable to carry

out the clean-up of that body of water. This task, known

as the Boston Harbor Clean-Up Project (“Project’’), is

estimated to involve $6.1 billion of public works over a

ten year period. The means and methods of carrying out

the Project are set forth in the MWRA’s enabling stat-

ute, Mass. Gen. Laws ch. IZ, app. $$ 1-1, ef sed. and the

Commonwealth’s public biddi pr laws. Mass. Gen. Laws

ch. 149, $$ 44A-44L and ch. 30, § 39M. Pursuant to these

laws, the MWRA provides the funds for construction

(assisted by state and federal grants), owns the prop-

erty O De DUlit, establishes all

bid conditions, decides all

contract awards, pays the contractors, and generally exX-

erecises control and supervision over all aspects ol this

In the spring of 1988, the MWRA retained Kaiser En-

gineers, Inc. (“Kaiser”) as its program/construction

manager. Kaiser’s primary function is to manage and

he ongoing construction activity. In the course

of performing its function, however, Kaiser could be ex-

pected te employ craft labor in certain situations. Its

agreement with the VWRA permits it to act as an exXecu-

tion contractor, or to perform certain direct hire work

as needed in cases of default or incomplete performance

by other contractors, clean-up work and other limited or

emergency situations.

Another important function of Kaiser is to advise the

MWRA on the development of a labor relations policy

which will maintain worksite harmony, labor-management

peace, and overall] stability during the ten-year life of the

Project. The MWRA had already experienced work step

}

pages ana ni Mmavllon.

Wa concerned tna IM

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and the number of difl

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Vuinerabdie U numerou

ordered scnedauie In Jeo

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Lo nossible contempt orde , ™ TI is concern Was ennanced

by the geogral] hie location of the existing and proposer

treatment faciliti which makes them vulnerable t

picketing and othe) concerted acti 1L\

The above circumstances led Kaiser to recommend

the MWRA that it be permitted to negotiate with th

building and construction trades unions, through th

B liding and 0! ICLIOT Council and affiliated labo

organizations ~* “Trades Co neil” ’ in an eftort to a

rive at an agreement which would assure labor stability

supyect wo review a

early May 1989 K aise}

gotlations. Aiter review

its recommendation, the

l Novembe! F19OQR +

ment of separate entra

metnod of maintaining {

dustry. Other threats were r

gnil int l rupt I i tuall

| yl

Suffolk ( int H e (

Island is similarly constra

transport workers, nstrus

harbor to Deer Island woul

yotential for labor unrest

the Trades Council such

* Thirty-four in all

lhe Master Labor Agreement was the resi

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by the MWRA

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wcUurred

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have to be de yned

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May 28, 1989 adopted the Master Labor Agreement as

the labor policy for the Project and directed that Spe

cification 13.1 be added to the bid specification for all

new construction work. Specification 13.1 provides that:

ly }ach successful bidder and any and all levels of

subcontractors, as a condition of being awarded a

contract or subcontract, will agree to abide by the

provisions of the Boston Harbor Wastewater Treat-

ment Facilities Project Labor Agreement [‘‘the Mas-

ter Labor Agreement” | as executed and effective

May 22, 1989, by and between | Kaiser], on behalf

of |MWRA}, and the | Trades Council] ... and will

be bound by the provisions of that agreement in the

same manner as any other provision of the contract.

A copy of the agreement is attached and included as

part of these Contract Documents...

The Master Labor Agreement establishes as “the policy

of the MWRA|] that the construction work covered by

this Agreement shall be contracted to Contractors who

agree to execute and be bound by the terms of this Agree-

ment.” It is the duty of Kaiser on behalf of MWRA to

“monitor compliance with this Agreement by all Con-

tractors who through their execution of this Agreement,

ogether with their subcontractors, have become bound

hereto.” The parties state the need to meet the “snecified

and limited time frames” established by the district

court’s order in the Boston Harbor Clean-up case. Also

agreed to are binding methods for the settlement of “all

misunderstandings, disputes or grievances which may

arise | and .. the Union, agree|s] not to engage in any

strike, slowdown or interruption of work [or] the |[em-

ployers| ... to engage in any lockout.”’

Most importantly, the Trades Council is recognized “‘as

the sole and exclusive bargaining representative of all

craft employees,” and its hiring halls are made the initial

and principal source for the Preject’s labor force. All

employees are subject to the union security provisions of

aryvuing

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MWRA, Kaiser and tl

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l 4a4riZed as IOHMOW

LR ABC eged ti

P i

cemptry syuler the NLRA ; ‘ (

nul Labor Relator Act “NLRA” or Act

,., prohibits the MWRA from 1

15] vel peg hit PY-

abor negvoualions process,

spec ihcally

the terms of

bargaining agreement with a union that has

aster L ibor Agr‘

IUCL, SUlt

inifest importance of the Boston Harbor cleanup. “Th

resence ul

a tne Dargalning agent DY employ-

district court held Lna pecbion 8!'e)

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LRA perm! Sucn restrictive igree-

iction Industry and that even if the

1 Impact must

LE et

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presente |

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Uil nuous

re to affect NLRA-regulated

be considered against the

employees SIMD increases

Ji ’

strife and crippling work

OppaLre The court ruled that the Master Labor

Agreement was lawful under the circumstances

2) Preemption under ERISA. ABC claimed that

nce the Agreement required employers to contribute 1

ist funds, the Agreement in effect regulated the ten

nd conditions of employee benefit plans covered unde

SeCTLIOI 314 ( Ol the Kimployee Retirement Income De-

\ct ERISA’), 29 U.S.A 11441 The court

reed, holding that the Agreement is not so broad

n applies to a single discrete project and thus

does not contravene ERISA

‘ hg ia pie ectio) quad adile proce ClhduUse (Lite (I-

} ABC claimed that the bidding procedure discriml-

nate against non-union contractors and effectively pre-

ide such contractors from bidding, thus violating the

equal proveclion a! d due process clauses These claims

were aiso rejected§$ bp Lie district court, which ruled

that non-union contractors are not a protected class, that

again, proced ire vere open Lo ali contractors, and that

nee ABC had fai ed to make any bid a Ol yel, a !

Litutionally prolec ad right wa acKking

| The Sherman j f clain ABC alle red that tive

Master Labor Ayreement and Specification 13.1 constitut

4 CONSpiIracy amony app llees to reduce con pelilion in the

i| { LDS (4 ind (1

\nalogous state claims were a rejected

LRRM

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Ray Sé¢ yA | | > | Ld? i I i in ne area

‘ i} ) rs " , ; oO) ’ ? , ' a enera intent To

re-en ne neid DU List tne ne apabie Impliica-

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rT I ex ] vene {y IO ‘e al LU In Guss

Supreme Court we! » far a carry that principle

eal a mf Ol rs i nev i , -mMmal - ’ | 1? wi icn no

‘ ‘ ‘ f ber ‘ ‘ son4 .

1! ] nh ©€xa ed on benall l ate au es » InLer-

rie mr r*¢ i i 1) TY a té i t red i \ Bat. 7 T | (jt -

Ul anaing f B ara retusa { exercist aoeminion

r ‘ { S| ile It I 1id ie I ted that a Ln itfl (;USS

. i 7 . — ; ‘ L024 ‘ 1}

Vt : iT | il? and I ras ‘ ‘ \ int i iT hal iy

rT I al laApe re rding tne represental n procedures

f I hed thereunder ind tneretore tne pri pie estab-

ed DY Gu r equal a} ition to representation

ry if ey} 5

| ‘ ‘ , ys ; ] hs / , 1QO5SG0 ; tha

t ia { t Ul \ ru (] i i ) (> rit

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mename ( re I { i \ W-

y for state intervention i rd ites affecting com-

ry ’ ’ ‘ ’ I "A ; ’ i " ; ;

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nhapler ov t ‘Titie 5

iIsdiclion Ove! any labor

both forms of preemption are implicated by this

ve beheve that the present case 1S Most heavily

ed y the Supreme Court’s holdings in tne Golden

Corp. cases, Which relied and expanded upon

doctrine. See Golden State Transit Cor

/ inqgele 175 U.S. 608 [121 LRRM 323:

Golden State I[\: Golden State Transit Corp. v.

Angel 193 U.S. 103], 110 S.Ct. 444 [132

S015 LYSY Golden State Il\. While there

ence between the Golden State cases and the

( We LI nkK Line S1TT11 ili cS nave yreacel

ime the employer was engaged in a labor dispute

inion tnatl represente d Its employees Che C1tYV

nd ned renewal of the labor dispute by a

franchise expired. The Supreme Court ruled

tion in conditioning renewal of the fran-

ettlement of the labor dispute was preempted

Act The Court stated, in language which we

adaptable to the present controversy

lf he labor-management relationship is struc-

d by the NLRA, certain areas intentionally have

left ‘“‘ ‘to be controlled by the free play of eco-

ic forces.’” . States are therefore prohibited

im Sing additional restrictions on economic

ns fr seil-heip, . . UNniess sucn restrictions

; rT iT) \ W Tre i*{ y Té r? ry] : | ed by { ‘ nm 1? ress

bicaAWI ii bipviel i ».

he crucial inquiry regarding pre-exemption is

ime whether ‘the exercise of pienary State au-

rity to curtail or entirely prohibit self-help would

n of the Act’s

state I, 476 U.S. at 614-15 citations omitted

+ ++

's insis ence On a e lement Was preempted by

because it “ ‘entered into the substantive aspects

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replacement had state law causes of action based on mis-

representations by the employer); Automobile Workers

Russell, 356 U.S. 634, 635 |42 LRRM 2142] (1958)

(State court jurisdiction over common law tort action

against union for mass picketing upheld); Youngdahl v.

Rainfair, 355 U.S. 131, 1382 [41 LRRM 2169} (1957)

(same re injunctive power to prevent interference with

free use of streets); Automobile Workers Uv. W isconsin

Emp. Rel. Board, 351 U.S. 266, 274 [38 LRRM 2165]

(1956) (same re power to enjoin violent union conduct) ;

United Constr. Workers v. Laburnum Constr. Corp., 347

U.S. 656, 657 [834 LRRM 2229] (1954) (state may ex-

ercise its historic powers over such traditionally loeal

matters as public safety and order and the use of streets

and highways) ; A len-Bradli j Local v. Wisconsin Emp.

Rel. Board, 315 U.S. 740, 749 [10 LRRM 520] (1942)

esame )

To be sure, there may be instances where the - regu-

lated conduct touch{es] interests so deeply rooted in local

feeling and responsibility that, in the absence of com-

pelling congressional direction, [a court] could not infer

that Congress had deprived the States of the power to

act.”” Garmon, 359 U.S. at 244. The district judge, in

a commendable attempt to harmonize the irreconcilable

conflicts presented by this difficult case, reasoned that

even if the Master Labor Agreement “were to have some

impact on NLRA-regulated conduct, that Impact must

be considered in the light of important state interest,

namely) the scheduled and court-ordered completion of

the harbor clean-up expeditiously and without unneces-

sary expense.” In effect, the court held that this public

purpose sanitized its constitutional shortfalls. While we

do not totally fault the court’s efforts in this respect,

nor disagree as to the importance of the Boston Harbor

clean-up, it cannot be said that congressional concern for

a uniform, national labor policy as embodied in the

NLRA, is entitled to secondary deference. Importantly,

the regulated conduct here is the labor relations bargain-

publishing a le

some

with pro

Oot stand

ate inte

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ll unwar

gislative

f highway safety, such a stat

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ited federal legislat

committee report

rest or policy other than

lon of Specification 13.1—‘“labor harmony during |the|

fe ] thi critical pt ject” are laudable,

y conflict with paramount federal law and must there-

iny event some-

, ] | +] ‘ .

what eptical of the pax industrial which the Maste

| abdo} Avreement ul it promote Thi peaceable

may be omewhat less than att unable consi ier-

ing that fil contract ] no Dar to rival. or for that

matter, antiunion, activity. See 29 U.S.C. § 158(f). last

Appellee contend that, had the Master Avreement

e€ entered nto arrecti petween tne tate avency and

the unions, it would be unassailable, because “|t|lhe Na-

onal Labor Relation Act leaves regulation of the labo

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relations ol! ite ind ( rovernme! Lo tne states.

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hood v. Detroit Bd. of Education, 431 U.S. 209. 223

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ne Al icil el } UVC! I tne ro ect iaporers., the NLRA

would be total] napplicable as Stat are excluded from

he definition of “emplove) 29 U.S.( 1212 lhe

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ites substantla participation i the Proje nowevel

‘ 4 ‘ 4 ‘ 4 , sal 4 ;

3s not en rn ito er ] atu Irom regulato. » em

, ? )

Ve) | ? coe i ! Criou Cle I! > ich l Cla-

ionship. There are insufficient indicia of an emplover

mployee relationship between the MWRA and the labor

Rather, the state is in its common role of a third

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121 LRRM 2737] (1986), the Court struck down a state

tatute barring repeat violators of the NLRA from bid

ad ng or state contract as preempted under the Grarmon

doctrine. Gould, 475 U.S. at 291. The state argued that

it should not be restricted by the Commerce Clause when

it acts as a market participant. The Court rejected this

rgument, noting first, that the state was- functioning

more as a regulator than as a market participant, and

ond, that the exes ption to the Commerce Clauss might

be broader than state action allowed under the NLRA.

Id. at 289-90. The Court based its analysis on the dif

fering purposes served by the Commerce Clause and the

NLRA: whereas the Commerce Clause contains “ ‘no in

dication of a constitutional plan to limit the ability of

the States themselves to operate in the free market,’

tihe NLRA, in contrast, was designed in large part to

‘entrust administration of the labor policy for the Na

tion to a centralized administrative agency.” /d. (cita

In concluding the G ! the Court explored,

but did not define, the boundaries of its holding

We do rat “iy that state purcha ing mec! ons

may nevel be infl enced by labor on ideration my

more than the NLRA prevents state regulator)

wwer from ever touching on matters of industrial

relations Doubt Dit tale pending policies, like

ome exercise of the polices powel iddress conduct

that is of such “peripheral concern” to the NLRA

or that implicates “interest 0 deeply rooted in local

feeling and responsibility.” that pre-emption should

not tx inferred frarmon to US. at 243-44 vere

alse e.g Bell nap line Hlale 163 ULS 1s] 10S

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, 4 s_ 7 ‘ "7 77 , -

i171 U.S. 724, 755 119 LRRM 2569

" , ‘ ‘

~ : » I . .

! . rogTa I g | ipl t rt i re ly

y y yer it Wa

+ ‘ g ‘ ' er tit. See Ne

i4 } Justice d

‘ , 1 tl mption inqui! See

I } ns 7-58 (Powell, J., dis

‘ s | rY i | ve rgued th it when i | \

t it ibor management relations, whether the statute is of

ra ibilitw or particularly directed at regulating labo:

n yement ‘tions is of little moment. By analogy. then. when

f it ch as Specification 13.1 directly affects labor-mar

igement relat vhether the regulation’s purpose is propriety or

gula y should be relatively insignificant.

ava

Ipnolaing cllé iLe re l ner cert I mini-

| ' . }

' hens ; pe Inciuded in employee health

‘ } t

\ nis coul ni noved, Decause such a statute

er eng lravges no caiscourages the collective bar-

— ; : ‘ »t } ] >A ?

It roce €@s tna clr ne subje OI the NLRA. IL 18

aq and unexceptional exercise of the State’s police

cé, Ine. 889

Z r. 1989 (quot-

letropolitan Life Ins, 471 U.S. at 755. 758

tne me cannot be said Ol Specification 13 s

) indates adnerences a “2 | ro lia) Contract with

ticular grou} I abor unlons I leu or the Ccollec-

** . *« }? : om | Ne . , ar

S peripheral to federal] labor polcy, or, second

ertain to matters “deely rooted in local feeling and re

onsibliity.”” Garmon, 359 U.S. at <43-44. As we have

ted ante, at p. 20 Specification 13.1 is a direct regu-

tion of the collective bargaining process. Thus it can

neither be termed “peripheral” nor “local.” To be sure,

the Boston Harbor clean-up is a

a matter of great local

nterest. It is not the clean-up, however. which is being

rey llated collective bargaining Is being reguiated., and

(nat cannot be

At any rate, Garmon is only one avenue of preemption

nder federal labor law—albeit on which most likely .

es tO Specinecation 13.] This opinion however, has

rested largely on the Machinists doctrine as articulated

in Gr dey State / It is noteworthy that 1? (rt dey Nfaots

/, on the Court had determined that the City of [os

Angeles had directly interfered with the collective bar-

uning process, it expr ssly aeclined to consider the 1 i

Lure and extent of the City’s interest 1 reso ng tne

labor dispute, Golden Stats /, 475 U.S it 617-18 an

, «A

. Y et ne ( \ woul seen te } ( } id i Strong

nd legit ite interest in ensuring the adequacy of it

ransportation system, see id. at 620 (Rehnquist, J.. dis-

| iiit ul eC. I tantamount LO the MWRA’s interest

n ensuring speedy comple on of the harbor clean-up. We

! ! conclude that esson of the Golden Stat

is¢ hat, where interference into the collective ba)

aining rocess -by the state is direct, an asserted state

interest of the type at issue here, whether “pr prietary

r otherwise, cannot justify the interference.

1D) Other Allegations

l) iew of our ruling on the issue of preemption of

Specification 13.1 by the Act it 1S unnece ar’) ! ]

reach the other questior raised by tl pe Si

V. CONCLUSION

on 13.1 unduly restricts aspects of the labor-

management relationship intentionally left unregulated

by Congress and is thus preempted by the National Labor

Relations Act, as amended, 29 U.S.C. $151, et seq

if the district court is reversed. The district

direction of this court in its original panel

opinion in this case, has already issued a _ preliminar

injunction against enforcement of Specification 13.1

That injunction remained in force during the pendenc’

of the rehearing en ban Therefore. we sil ply orde}?

that the preliminary injunction continue in effect during

the further proceedings in this case

Reversed and remanded. Costs to appellants.

w The r ’ | i , reach t hy q , ‘ \) '? ,

{, ; ‘io nheral oY ept nm ever ‘ t i VJ chi int

Disse ; f2) ‘/ Opinion

‘7

BREYER, Chief Judge. with whom CAMPBELL. Cir-

ut Judge joins’ (dissenting The Commonwealth of

M: ach setts, acting through the Massachusetts Water

Resources Authority. will let contracts for more than $6

or construction work on the Boston Harbor Clean

Up Project. The MWRA requires, as a condition for a

contract award, that the winning bidder abide by (and

insist that its subcontractors abide by) a pre-hire bar-

ining agreement. That agreement requires the con-

tractor and ubcontractors LO recognize the Building

Trades Council as bargaining representatives for all craft

employees, to hire workers through the hiring halls of

Council’s constituent unions, to require hired workers

to join the relevant union within seven days, to follow

ecified dispute-resolution procedures, to apply the Coun-

cil’s wage, benefit, seniority, appr nticeship and other

enefit funds. In return for the MWRA’s promise to in-

at contractors sign the agreement, the Council has

niused the MWRA

life of the construction proyect.

rule and to make contributions to the Council unions’

abor peace throughout the 10-year

Were the industry here involved other than the con-

truction industry, we could understand how the maior-

itv would consider this agreement a rather intrusive

effort by a state agency to control the labor relations of

‘ubcontractors with their employees. The construction

industry, for labor-relations purposes, however. is spe-

Cla A all parties concede, the special construction-

ndustry provisions in §$8ie) & (f) of the National

Labor Relations Act, 29 U.S.C. §$ 158(e) & (f). would

permit the MWRA, were it a privat. party letting con-

, +;

ruction contracts, to act just as it wishes to act here

Indeed, genera! contractors in the construction industry

often enter into prehire agreement of this sort. The only

question In this case is whether the NLRA forbids the

MWRA, because it is a state agency, to do what the

Act explicitly permits a private contractor to do.

in invuage it e27-

f n ‘ i vPeneral co) ruction

1} 2 } ? ) ‘ rel é vyreement

R he Ih¢ ! } ay CVE na ne CMP cCitly ror-

| [ he ct im CILIY re

noved or ¢ ‘ f OWe) I ~ Lhe

1\\ qh \ ’ | >) \ ? re) i ring | es Ol

~@) } en rity mu herelore believe ] tnat

IWRA’ nfl Wit! the Act 2) ti t

f ( Ling rede} : tory “i ne rie ) ;

‘ | } ne 0 »T the CITCUMSLAaNnces

| (0) res ought to OCccul tne fhe d the CXCIU r)

f 1] ‘ Valo Whit Motor Cor) i835 U.S

ay 904 4 | RRM >] iv I 78 se no TO) h rene)

( naitions TQ) re~e } QO? t¢ al 0 SCH V« h¢ /

INi? J) M ( ) tS5 | ~ G2 tt) ( TORR We do

ne e¢ } \\ ermitt ny ils ivyency when aclLIing rt

tL pener; contr: or, W make labor rreement u

LIN I { I ile venera Contractors n Ke could CO?Y

flict with” the NLRA, “frustrats the NLRA “schem

>) otherw f 1? lterlere with the rey llato) \ tem tf I

the N] RA ere ates. We therefore dissent

The S ipreme ( rt has described LWO related sets of

concer? tnat led Cor Press Implicitly to forbid cert n

Kinds of te activities. First, Congress intended to grant

the National Labor Relations Board ex € authority

determine whether £ 8 of the Act prohibits or § 7 of the

Act protect certain particular labor-related activities and

») (lé remedy oO lOlal I I} ls, (with a Tew

peur) ( f mn i Mme May not regulates activities

Lnat thi Act aryvuat ' prol ibit a)" protects SN ‘ Na)

Carmon. 359 US 236.

244 1.) 13 | RRM 2838 1959 Nor

thet \ if idd Lo. or

ract fron the reme dies that the federal scheme pore

cle \é (,0r ‘) / pmste, [ cal Unio Vo 176.

646 US. 485, 498-99 33 LRRM 2215 1953

Nee) be |

nd, Congr lntended

oO “leave some activities un

by the free play of eco

nomi lorees,”’ Lodq (6, Int’ iss’n of Machinists UV.

lf r ) Emp Oipeinyt Re at OuS Con i} ) " 27 U.S. 132.

144 (92 LRRM 288] (1976). Thus, states may not reg-

ulate “economic Wartare between labor and nanage-

ment,” New York Tel. Co. ». New York State Labor

Hep'l, 440, U.S. 519, 580 [100 LRRM 2896] (1979).

when doing so significantly interferes with the “inten-

ional balance”’ that Congress contemplated “between the

‘Heontroled power of management and labor to further

their respective interests.” Golde» State Transit Corp. v.,

Cily of Los Angeles. 475 VJ 5. 608, 614 | 121 LRRM 3233)

LYS6 They may not, for example, award damages for

peacelu secondary picketing. se¢ Local JU, Teamste rs

{) Morton, 377 U.S “02, 258 [56 LRRM 2225]

1964 or forbid a union’s concerted refusal to work

overtime. ses Machinists. Zz? U.S. at 149, for. in both

nstances, Congress intended “to preserve” those “means

economic warfare for use during the bargaining proe-

ess.” New York 7, !., 440 U.S. at 530

The majority finds this second kind of pre-emption

resent here. It concludes that the MWRA has regulated

the relationship between labor and management In a way

‘nat upsets the “balance” between labor and manage-

ment that Congress intended. In our view, however. the

peclal Construction-industry exceptions in the Act itself

show that Congress did not intend pre-emption. Insofar

as the MWRA’s purchasing decision affects labor-manage-

ment relations, it does SO only to the extent that Congress

roresaw and with respect to genera] contractors) ex.

piecitly authorized. Moreover. the relevant Supreme Court

ises in this area reintorce our view that the MWRA’s

ictions do not “conflict with” or otherwise “frustrate”

the NLRA or its objectives

lL The ict’s Construction-Industry E’xcepti NS The

construction-industry exceptions of the NLRA make clear

that the conditions that the MWRA Wishes to impose do

not represent an effort by the state to tilt the economic

playing field, that is to Say, to interfere with the “free

>) :

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And ne 130

‘

ins

Oo ns, but it would continue to invali-

n prehire agreements when it confronted

ld -6

hereafter, the Senate Subcommitte on Labor and

I rement Relations held hearings, on the con-

n industry. See Hearings, supra. Representatives

and management testified that the special

ristics of the construction industry made it im-

innecessary and undesirable to comply with

ements of the Wagner Act (as amended by

ft-tHart e\ Ac ihey pointed out that a construc-

er typically works at a particular site only for

me. In such a context, to require formal cer-

elections is impracticable, for particular em-

1d no stay on the job long enough to elect

es who then would bargain with the em-

Those testifying feared that the alternative to

‘vaining at all. With-

re bargaining, unions would not’ be able to bar-

har aining would he no bat

inion security while contractor would not be

Oo estimate their labor expense In advance and

be able to rely on a steady supply of labor

inion hiring halls. See venerally 5 Rep. No 1509,

at 3-6 (summarizing testimony at hearing).

Senate Committee on Labor and Public Welfare

orable reported a bill that would permit prehire

nents It said

The committee finds that the normal election pro

ires Of the Board have proven unadaptable to this

istry because of the short-term, casual employ

nt that | typical of it The General Counsel's

to devise special mean have proven fruit-

We conclude that the obstacles to conducting

auctory elections in sufficient numbers are for-

lidable, if not insuperable

No. 1509, supra, at 6. The bill did not become

some time. But in 1959, Congress enacted a simi-

, a

[ e lioust ! Sel e Reports acct npany-

e | ’ I ( ¢ I the reasons tor the ANC

ere é e] é n the 1951 hearing

t ( | er! Nn 11°¢ ) A ment ths ry

no ne certincatll elections, the co

} 10} redaictabie COs ind a Steady supp I

0} ! ongstanding custom Ol prehire bargaining

See S. Re No. 187, 86th Cong., 1

sess., £(-od 1959 reprinte 1 NLRB, Leg

f L/ Labor-Manaqeme Reporti and D

) 423-25 (1950 hereinafter Legisia

History] (set out in Appendix); H.R. Rep. No. 741

26th Cong.. Ist Sess., 19-20 (1959), reprint din 1 Leg

tive History, supra, at T77-78; see also 105 Cong. Re

35731 ‘daily ed. Apri] 21, 1959), repru ted in 2 Leg

History, supra, at 1064 remarks of Sen. Javits)

105 Cong. Rec. S5767 ‘daily ed. Apr 21, 1959), 7

t 9 Legislative History, supra, 1082 (remarks

f Se Goldwater): 105 Cong. Rec. $9117 (daily ed.

June &. 1959), reprinted im 2 Leqislative History, supre,

at 1289 ‘prepared statement of Sen. Goldwater); 105

Cone. Ree. H14.204 (‘daily ed. Aug. 11, 1959), repriited

2 Legislative History, supra, al 1577 | prepared state

ment of Rep. Rayburn); 105 Cong. Rec. H16,630 (daily

é September 4, 1959), reprinted wm 2 Leqislative H

spra. at 1715 (remarks of Sen. Kennedy) ; 105

Cone. Rec. A4308 ‘daily ed. May 21, 1959), reprinted

9 Legislative History, supra, at 1750 (remarks to Re;

Kear! At the same time, Congress enacted an excep-

tion to § 8(e), so that its prohibition of hot-cargo clauses

would 1 prevent parties in the construction industry

from entering into prehire agreements, which, tradi-

tionally. included a provision requiring the general con-

tarctors who would sign the prehire agreement. See 105

Rec. S16.414 (daily ed. September 3. 1959), re-

/ 2 Leqislative History, supra, at 1432 (re-

tit

Cong

prt hee

marks of Sen. Kennedy) (stating that the proviso of

€8ie) was “necessary to avoid serious damage to the

ova

pattern f collective bargaining in the construction |

ndustr{y|]"); 105 Cong. Ree. $16,414 (‘daily ed. Sep-

ember ) 1959 reprinted im Z Leyislative History,

pra, at 172 remarks of Rep. Thompson) (same).

As the majority correctly points out, the construction-

‘

ndustry exceptions use the word “employer,” and § 2(2)

of the Act specifically excludes “any State’ from its

definition of the word “employer.” Ante, at 23-25, 32.

That fact, however, does not destroy the relevance of the

exceplions as an indication of Congress’s pre-emptive in-

tent. for one thing, the provisions show that Congress

specifically focused upon the conduct in question, prehire

raining, that Congress found that conduct prevalent

in the construction industry, and that it wrote the excep-

tions with the expectation that the conduct would con-

tinue in that industry.

For another thing, the reasons Congress gave for

iuthorizing the conduct have nothing to do with the pub-

ic or the private nature of the employer. The special

circumstances in the construction industry making mean-

ingful posthire collective bargaining difficult; the cor-

responding custom in the industry; a general contractor's

need to predict labor costs; his need to have available a

eady supply of labor: these reasons have to do with

the nature of the construction industry and collective

bargaining in that industry, conditions likely to remain

the same whether a public or private contractor lets con-

tracts for the work.

Further, to permit private general contractors, but not

tates, to enter into construction-industry prehire agree-

ments would likely produce an odd crazy-quilt of prehire

practices. Whether one finds such an agreement would

often reflect, not size of the project, or desire of the

parties, or special conditions of the industry, but simply

whether on not the entity letting the contracts is an arm

of the state or private. And, even among state projects,

the presence or absence of such an agreement would de-

] | ‘ . ; ‘ . ‘ P

pend pon Wit Ne?) SLA LE iaW permits ine slate im «

tlon to hire a private general contractor (who. the:

presumably, wi uld be free to enter into a prehire aye

ment), or, as in Massachusetts, requires the stat

pel

sign the relevant contracts itself. Sce Mass. Gen. |

ch. dU, 3 39M: id. ch. 149. 144A ef seq We do not ul

tand what purpose, related to labor law, Lnese leva! Gis

t ctlions could serve

Finally, Congress had two perfectly good reas

not making the construction - dustry exceptions ©)

applicable to states, al! id neither of these reasons ~Uprpte

any pre-emptive intent. First, the obvious reason

the list of forbidden practices, to which the ercey

apply, itself applies only to an “employer,” defined to «1

clude “any State,” t nee Sr leaving the regulation of

relations between a state and its own employees primar

to state law. A drafter, writing a statutory except

lormally extend

—

’

libition in the

the resulting prohibition, would not

scope beyondy those subject to th

e pi

larly when it enacted

place ome Congress, particu

construction-industry exceptions in 1959, had litt

to believe that a court might find, hidden in the sil

of the Act, some other relevant prohibition applicabh

a Slate.

In sum, the construction-industry exceptions in the A

including their history and rationale, indicate that whe

a state acts as an ordinary private purchaser of cons'rs

tion services, it can enter into a typical prehire agre

ment without “frustrat{ing]” the “federal [statuter,

scheme.” Malone, 435 U.S. at 504.

2. Supre me Court Precedent. Unlike the majority, ¥:

believe that the relevant Supreme Court decisions o!

fairly strong support for our conclusions. For one thin,

the Machinists case itself makes clear that the Act des

not forbid all state action that might favor labor, but

‘ather, only those state actions that interfere with Con

gress’s “intentional balance.” See Golden State, 475 Us

r 614 (citing Machinists, 427 U.S. at 146 emphasis

“a > '

rdded Here, for reasons just mentioned, we believe

(onvress intended a “balance” in the construction in-

dustry that inciudes prenire agreements.

For another thing, the Supreme Court has looked to

utive history (indeed, the language and history of

ther congressional statutes), as we have done here, to

nd the existence or absence of a congressional pre-

emptive intent. After examining legislative history that

would seem no more significant than that present here,

ample, the Court upheld a state law providing un-

employment benefits to striking workers, a law that would

«em to tip the playing field in the strikers’ favor. See

Vew Lork Tel., 440 U.S. 519 [100 LRRM 2896

Further, the Court has indicated that the kind of state

‘ity involved is relevant to the pre-emption question.

ter all, the NLRA seems basically intended to supplant

ite labor regulation, not to supplant all legitimate state

ty that might affect labor. Thus, it is not surpris-

ng that the relevant Supreme Court cases, speaking of

e area where Congress implicitly intended labor-man-

agement relations “to be controlled by the free play of

economic forces,” refer to freedom from State regulation.

In Machinists itself, for example, the Supreme Court

refers to the relevant congressional pre-emptive intent as

intent to “leave some activities unregulated.” 427

U.S. at 144. It said that the “activities” in question—

workers deciding in concert to refuse overtime work

vere not to be reqgulabl. by States. .. Id. at 149

emphasis added). And, in Golden State. the Court, find-

ng that California could not condition the renewal of a

taxicab franchise upon settlement of a labor dispute, said

that “Machinists pre-emption . . . precludes state and

municipal regulation ‘concerning conduct that Congress

intended to be unregulated.’” 475 U.S. at 614 (quoting

Mi tropolitan Life Ins. Co. v. Massachusetts, 471 U.S. 724.

749 [119 LRRM 2569] (1985) ) (emphasis added). At

( I} rie

17 sé_} ‘ ‘

waci j p @-emMmption goes not Involve in at

; + ; ‘ ‘ fest . ] ; ect 79 '

instance a balancing of ate and federal interests,” an

‘ pre ion OL the states interes In revulalInv a C@)

} -_ . si) ¥ . are ; : +o "

in kind of conduct may stil! be relevant in determining

’ ; f ‘ ; ‘ ] ‘ lisne ‘ }

hether Congress in fact intended the conduc » be un

regulated.” Metropolitan Life, 471 U.S. at 749-50 n.27

rina when the ¢ rt na considered Stale purcnas-

} :1 ‘fle? } +} ZEL { +}

} ] Nas Carerlully considered @ nature Ol € SLALE

ticn and the legitimacy of the restriction’s purpose. I

Wisconsin De partment of Industry. Labor and Huma

Relations v. Gould, Inc., 475 U.S. 282 [121 LRRM 2737]

1986), the Court found pre-emption of a Wisconsin pun

chasing-related rule—a rule that disqualified as a supplier

any firm found to have committed several unfair labor

practices. In doing so, the Court stressed the lack of any

such legitimate relation in the case before it. The Court

said that “debarment .. . serves plainly as a means of

enforcing the NLRA,” id. at 287, that it “functions un-

ambiquously as a supplemental sanction for violations of

the NLRA,” id. at 288 (emphasis added), and

other purpose could credibly be ascribed.” Id. at 287

(emphasis added The Court concluded that, because

“Wisconsin s mply s not functioning as a pr vate pur-

chaser of services, for all practical purposes, Wisconsin’s

debarment statute is tantamount to regulation.” /d. at

289 (empsasis added}. To emphasize the point that

Wisconsin was not acting like “a private purchaser of

services’ —the Court added:

We do not say that state purchasing decisions may

never be influenced by labor considerations, any more

than the NLRA prevents state regulatory power

from ever touching on matters of industria] rela-

tions. Doubtless some state spending policies, like

some exercises of the police power, address conduct

that is of such ‘peripheral concern’ to the NLRA, or

that implicates ‘interests so deeply rooted in local

feeling and responsibility,’ that pre-emption should

now. we inferred Carnon, 359 U S al 243 244: oe¢

0, e.g., Belknap, In Hale, 463 U.S. 491, 498

1183 LRRM 3057! (1983 And some spending de-

terminations that bear on labor relations were in-

tentionally left to the States by Congress. See New

York Tel. Co New York State Labor Dept., 440

U.S. 519 [100 LRRM 2896 1979 But Wiscon-

in’s debarment rule clearly falls into none of these

Cate vrories W ¢ ore not raced here ? t} a fatute

fhat ca? é e) pidu bly hy / fended as a é gitty ate

DO? , ty torte procureme t constraints or to local

} pie Ss. OF j fj “7 (‘Lil that DULITSUCS 4 la h

Longre ntende [ eave to the States The mani-

ic irpose al ble effect of the debarment

rule is to enfor iirements of the NLRA

In the case before us, the record makes clear that the

MWRA is participating in a market place as a genera!

contractor, like a private buyer of services. Its role as

buyer is not, in any sense, a sham designed to conceal an

effort t late. That role is direct. normal and neces-

sary for purchasing, not regulatory, reasons. The MWRA

wants to condition its contracts in the same way as, and

Oo reyvu

for the same reasons as, private contractors n mally

insist upon similar conditions, namely to obtain peaceful

working conditions, necessary to get the job done on time.

The record requires us to take as given that, without a

prehire agreement, hundreds of collective-bargaining

agreements would expire during the life of the project,

making labor strife likely. Because the major work site,

Deer Island, is connected by a narrow isthmus to the

mainland, a small number of pickets would find it easy

to stop the entire project. Court-ordered deadlines means

that delay would cause unusually serious problems. The

record therefore supports the MWRA’s contention that

the prehire agreement serves its economic self-interest as

“a

‘

, Ly

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’ T t ed DV

+} ‘ ;

| A ‘ ‘ naustry Alt

nearings and presidential mes-

resolve certain most urgent prob-

re other difficulties which require

he bill [as did an earlier version], contains other

ns which take into account the occasional nature

f employment in the building and construction employee

It does so by reducing from 30 days to 7 the grace period

before which the employee may be required to join

union. The reduction in this time allowance reflects the

normally short employment period for construction em-

ployees. Also similar to [the earlier version] are provi-

sions permitting an exclusive referral system or hiring

hall based upon objective criteria for referral. Such

criteria as are spelled out in the vill are not intended

, ;

bid

’

ris

Vers LO

; "

y pS

rentice-

Labo.

right of

an e@xX-

under

48a

APPENDIX B

Ss. COURT OF APPEALS

IRST CIRCUIT ‘(BOSTON

p —

No. 90-1392

ASSOCIA BUILDERS AND CONTRACTORS OI

,LASSACHUSETTS RHODE ISLAND, INC., «

MASSACHUSETTS WATER RESOURCES AUTHORITY, ef

October 24. 1990

Ap) il 1! IY Le | ~ District ( l? | r T ‘ District

I Ma “lA husetts Reversed and remanded

Maurice Baskin (Carol Chandler, Mary L. Marshall,

Stoneman, Chandler & Miller, Thomas J. Madden, and

Venable, Buetie Howard & Civiletti, nm bmef), for

appellants

John M. Stevens, for appellee MWRA

James J Kelley, for appellee Kaiser.

Donald J. Siegel (Mary T. Sullivan and Segal, Roit-

man & Coleman, on brief), for appellee Building and

Construction Trades Council of the Metropolitan District.

sefore CAMPBELL and TORRUELLA, Circuit Judges,

and RE,* Judge.

The Honorable Edward D. Re, Chief Judge of the United States

Court of International Trade, sitting by designation,

Full T. f Op

TORRUELLA, Circuit Judge Plaintiffs-Appellants

Associated Builders and Contract f Massachusetts

Rhode Island, In “ABC's eal the decision of the

United States District Court for the District of Massa-

chusetts denying ABC’s request for a preliminary injunc-

tion. For the reasor tated below, we reverse this deci-

sion and remand for action consistent with our opinion.

PROCEDURAL BACKGROUND

ABC is an organization composed of individual con-

struction contractors and trade associations representing

over 18,000 “merit shop” (i.e., non-union) construction

industry employers. On March 5, 1990, ABC brought

suit in the United States District Court for the District

f Massachusetts against the Massachusetts Water Re-

sources Authority (“MWRA”), Kaiser Engineers, Inc.

(“Kaiser”) and the Building and Construction Trades

Council and affiliated labor organizations * (‘Trades Coun-

cil’’), challenging tne legality of the bidding procedures

established by MWRA to Carry out $6.1 billion worth

of public works known as the Boston Harbor Clean-Up

Project (“Project”). ABC sought injunctive relief

against enforcement of Specification 13.1 of the MWRA’s

bidding procedures, which provides that:

I;Jach successful bidder and any and all levels of

subcontractors, as a condition of being awarded a

contract or subcontract, will agree to abide by the

provisions of the Boston Harbor Wastewater Treat-

ment Facilities Project Labor Agreement [the Mas-

ter Labour Agreement”] as executed and effective

May 22, 1989, by and between (Kaiser), on behalf

of |MWRA\], and the | Trades Council] .. . and will

be bound by the provisions of that agreement in the

1 Also its national association and five individual contractors.

* Thirty-four in all

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ivy nA ‘. | . | art 4 i }

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Vassachuse eg re to pl le water supp

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ces ewayve ¢ ecLIOr ind treatmer! ! disposal e)

7 ‘ : | r

ces Ior the eastern ! f of Massachuse Following a

‘ no ; f ; r¢ tr sé ent t he Ty i

Wsu riS ‘ 4 ' ia i Ii

tion of Boston Harbor, United States of America

Metropolitan District Commission, C.A. No. 85-0489 MA

Mazzone J the MWRA was ordered to meet a di

tuiled timetable to carry out the clean-up of that body of

water. The means and methods of carrying out this task

4 forth in the MWRA’s enabling statute, Ma

are s

Gen. Laws ch. 92, app. §£ 1-1, et seg., and the Common-

wealth’s public bidding laws. Mass. Gen. Laws ch. 149,

Dla

14A-44L and ch. 30, § 39M. Pursuant to these laws,

the MWRA provides the funds for construction (assisted

tate and federal grants owns the property to be

built, establishes all bid conditions, decides all contract

awards, pays the contractors, and generally exercises con-

trol and super\y ision over all aspects of this project.

In the spring of 1988, the MWRA retained Kaiser as

ts program/construction manager. Kaiser’s primary

function is to manage and supervise the ongoing construc-

tion activity. In the course of performing its function,

however, Kaiser could be expected to employ craft labor

in certain situations. Its agreement with the MWRA per-

mits it to act as an execution contractor, or to perform

certain direct hire work as needed in cases of default

0} incomplete performance by other contractors, clean-up

work and other limited or emergency situations.

Another important function of Kaiser is to advise the

MWRA on the development of a labor relations policy

which will maintain worksite harmony, labor-manage-

ment peace, and overall stability during the ten-year life

of the Project The MWRA had already experienced work

stoppages and informational picketing at various sites

and was concerned that, because of the scule of the Pro)-

ect and the number of different craft skills involved, it

was vulnerable to numerous delays thus placing the court-

ordered schedule in jeopardy and subjecting the MWRA

to possible contempt orders. This concern was enhanced

by the geographic location of the existing and proposed

treatment facilities which makes them vulnerable to pick-

eting and other concerted activity.

In November of 1988, two member unions of the Trades Council

picketed the Project and precipitated a brief work stoppage, which

was ended by establishment of separate entrances to the job site

This is a well recognized method of maintaining continuity of work

in the construction industry Other threats were made to dist ipo

the work, but no other significant disruption actually occurred

‘At Deer Island access to the ite was by a single two-lane road

passing through crowded Winthrop streets, and next to the existing

The MWRA accepted Kaiser’s recommendations and in

early May 1989 Kaiser proceeded to meet with negotiat-

ing teams from the unions, including the Trades Coun-

rT 14 1 — es :

Cll The Master Labor Agreement was the result of heil

? . . | } 4 , t-« ‘ "

negotiations £ fter review by the MWRA Stall, and upor

its recommendation. the MWRA Board of Directors on

May 28, 1989 adopted the Master Labor Agreement a:

the labor policy fo) the Pre ect and directed that Spec

fication 13.1 be added to the bid specification for all new

( nary ] y VM rk

The Master Labor Agreement establishes as “the policy

of the |MWRA|] that the construction work covered by)

this Agreement shall be contracted to Contractors who

agree to execute and be bound by the terms of this Agree-

ment.” It is the duty of Kaiser on behalf of MWRA t

“monitor compliance with this Agreement by all Cor

ractors who through their execution of this Agreement

ogether with their subcontractors, have become bound

hereto.” The parties state the need to meet the “specified

and limited time frames” established by the district

court’s order in the Boston Harbor Clean-up case. Also

agreed to are binding methods for the settlement of “al!

misunderstandings, disputes or grievances which maj

arise {and . the Union, ayree(|s not to engage in

A! ;

Suffolk County House of Correction. Access to the facility at N

rained Facilities being built off-island to

Island similarly const

‘

transport workers, construc m materials and equipment across the

harbor Lo Deer Islar d would have to be de signed or ada ted to the

potential for labor unrest with unions other than member unions

of the Trades Council such as those representing maritime workers

ro.

YJvd

any strike, slowdown or interruption of work [for] the

employers] ... to engage in any lockout.”

Most importantly, the Trades Council is recognized “as

the sole and exclusive bargaining representative of all

craft employees,” and its hiring halls are made the in-

itial and principal source for the Project’s labor force.

All employees are subject to the union security provisions

of the agreement which require that they become union

members within seven days of their employment. Em-

ployees may seek redress for their grievances only

through the recognized labor organizations, and the con-

tractors are bound by the Trades Council member un-

ions’ wage and benefit provisions and apprenticeship pro-

gram. The contractors are required to make contribu-

tions to various union benefit trust funds and to observe

the unions’ work rules and job classifications.

The Master Labor Agreement became “effective [on]

May 22, 1989, and shall continue in effect for the dura-

tion of the Project construction work.” As previously in-

dicated, the Project is expected to take ten years to

complete.

Hl. THE PROCEEDINGS BEFORE THE DISTRICT

COURT

ABC’s contentions before the district court can be sum-

marized as follows:

(1) Preemption under the NLRA. ABC alleged that

the NLRA prohibits the MWRA from interfering with

the labor negotiations process, specifically arguing -that

requiring employers to accept the terms of a collective

bargaining agreement with a union that has not Been

designated as the bargaining agent by employees is il-

legal. The district court held that Section 8(e) and if)

of the NLRA® permit such restrictive agreements in the

construction industry and that even if the Master Labor

529 U.S.C. §§ 158(e) and (f

o4a

Agreement were to affect NLRA-regulated conduct, sucl

impact must be considered against the manifest impo:

4} > > ‘ } . ] ‘ 7% $6 .

tance Ol ne Bo on Harbo) ciean-Up. The presence vo]

m-represented employees simply increases the potential

for continuous strife and crippling work stoppages.” The

court ruled that the Master Labor Agreement was law

ful under the circumstances.

2 Pre f mption under ERISA ABC claimed that Sine

the Agreement required employers to contribute to trust

funds, the Agreement in effect regulated the terms and

conditions of emplovee be! ent plans covered unde? Sec

tion 5l4ic) of ERISA. 29 U.S.C. §$ 1144(¢). The court

disagreed, holding that the Agreement is not so broad

and only applies to a single discrete project and thu

does not contravene ERISA.

(3 Equal protection and due process clause alleqa-

tions. ABC claimed that the bidding procedures dis-

criminate against non-union contractors and effectivel)

preclude such contractors from bidding, thus violating the

equal protection and due process clauses. These claim

were also rejected by the district court, which ruled

that non-union contractors are not a protected class, that

bidding procedures were open to all contractors, and that

since ABC failed to make any bids as of yet, a constitu-

tionally protected right was lacking.’

(4) The Sherman Act claim. ABC alleged that the

Master Labor Agreement and Specification 13.1 const-

tute a conspiracy among appellees to reduce competitio!

in the construction industry by effectively precluding nor

union contractors. Below, the court reiterated that ap

pellants were not excluded from the bidding process and

furthermore since the Master Labor Agreement “serves

legitimate business, and public purposes” there was no

anti-trust violation. Moreover, the district court found

that the MWRA, as a state entity, is immune from an

* Analogous state claims were also rejected.

] ; ‘ , ‘ Y >

ist claim and that Section 8(e) of the NLRA

1 ] ’ Semen ae —T

along with labor’s non-sta Ory anti-trus exemption un-

der the Sherman Act protect Kaiser and the Trades

Council as well.

(5) State law claims. The district court rejected

ABC’s state law violations claim, ruling that the Mas-

sachusetts Public Bidding statute specifically required

hat the winning bidder must furnish labor that can

work in “harmony with all the other elements of labor

employed or to be employed on the work.” It further

ruled that there was no interference with business re-

lationships because no relationships existed as of yet.

"hus, the district court denied a preliminary injunc-

tion holding that first, the appellants were not likely to

succeed on the merits. Second, ABC had not shown im-

mediate and irreparable harm because it had not been

awarded a contract and even if it had it would have an

lequate remedy at law. Third, the balance of harm

to the appellants was outweighed by the harm to the ap-

pellees, since the appellees would suffer ominous delays,

sruptions, and increased costs in the Boston Harbor

clean-up without Specification 13.1. And last, issue of

an injunction would adversely affect the public interest

in the swift clean-up of Boston Harbor.

IV. STANDARD OF REVIEW

Or? review, we will reverse the district court’s denial

f .

{ a preliminary injunction where the denial is an abuse

{ discretion, or is based upon a clear error of law. or

where the district court’s findings of fact are clearly er-

roneous. See, e.g., Massachusetts Ass’n of Older Ameri-

ca) Sharp, 700 F.2d 749, 751-52 (1st Cir. 19R3) ;

Vaccira v. Pagan, 649 F.2d 8, 15 [107 LRRM 2408}

(Ist Cir. 1981): General Electric Co v. New York Stat

Dept. of Labor, 891 F.2d 25, 26 [133 LRRM 2044] (2d

Cir. 1989) (reversing denial of preliminary injunction on

ERISA preemption grounds) ; 7 Moore, Federal Practice,

and Procedure 65.04) 2 dd ed. 1987 Wher, ,

appellants re asking lor a mandat ry injul nw

will change the status quo ante during the pend f

litigation, we will take into account the eXivencit ,

‘ a |

circumstances OI the situatio! See Ma } (

n of Citiz vith Disabilit ( Defense A

649 F.2d 71, 76 n.7 (1st Cir. 1981

To be entitled to Injunctive relierl a a I ‘

tabdlisn tnat it has a likelihood OI success on the Nhe

; ‘ o eae : ; ;

tnat it will surer immediate and irr: arable harm if re

lief is not granted, that such harm outweighs any h

to the non-moving party, and that the publie inter

E j |

not be adve rsely affected. Planned Parenthood ey tf

641 F.2d 1006, 1009 (1st Cir. 1981): Lancer Leha

Housing Authority, 760 F.2d 3601. 362 Ist Cj Luss

The balancing of interests shifts in plaintiffs’ favor wh

a strong likelihood of success on the merits Is how

SEC v. World Radio Mission, Inc., 544 F.2d 535, 541-42

(1st Cir. 1976).

V. DISCUSSION

In our opinion, appellants present a portent

ment that there is a strong likelihood of thei)

the merits, an argument which ultimately carries th

day.

A. Pre é mptvor unde r the NLRA

We commence with the text book proposition that u!

der the supremacy clause of Article VI of the Constitu

tion,’ the “supreme” congressional law supersedes per

7 U.S. Const. art. VI, para. 2

This Constitution, and the Laws of the United States wh

shall be made in Pursuance thereof: and all Treati

which shall be made, under the Authority of the United Stute>

shall be supreme Law of the Land; and the Judges in «

State shall be bound thereby, any Thing in the Constitution or

Laws of any State to the Contrary notwithstanding

em) tate lav Preem) I CCU I ! wine tnere

, it) rt ( nfi iv Vee! eal: rece neme nad

j ai Vu Rs bia v\ ] n a

+} + ‘ rer ’ remel ? ry ? ’ Vine? ’ ‘ ’ iCLIOI

hit SLA Lt cul i i \ i i VV ¢ a :

a mi To! parriel 4 whel tate regu if ’ inter-

feres unduly With the accol nment if nore ,

CCcLIVe Congressional legisiatiol I i! irea in WhNICI

; t ) y | ? | ’ t ’ ) cy

a4 stale SCeCKRS { CVYVUIALE UVES ! ect 1 ( lige a

: ] ‘ ‘ . ;

ite action. Nor does the fact that there is no explici

7 l¢ il-state CO?! fl ct oy) Cc nere na of femeny? oO! 1]

, ; + , " ? rt? ) ’ ’ ' ) abi a

tl { a it au ‘ i} i ait ‘ 4 ‘ i

ner [ nreen Tw?! ( 7 (yu fal Ly ai j Re lt if

{ I

pr" < ’ >t sr ai Oorr

fi [ Ter) | 5 ] > l RR Vi 200 1 ] IO:

The quest } i? eac! case wnat tne purpose oO!

{ ngress W I ey iting Suc i purpose

: ’ ,

IT y pe ¢ ladenced ll severa Wa scheme ol

tederal regulation Ma pe s ( a ea { make

rea apie tne nrerence tnat t neress eTt mn room

I r tne states | i ement Tt (>) TM Act Tl { r).

press may ouch a field whic! Lneé fede? i inter-

est 18s so dominant tnat the redera tem W me

issumed to preclude enforcement of stat aws on tne

ry } } *f | i} ; ) +} " hia vit + } }

Same supore AKew1se. ne one sougi 'e D

vs (+) Padaral | ‘ ‘ J : ‘ £

tained by he federal law and the character of ob-

ligations imposed by it mav reveai the same purpose

Or the state policy may produce a result inconsistent

with the objective of the federal statute It is ofter

, ' . . mi

: . y 7

a preplexing question whether Congress has pre

’ . : . <

cluded State action or by the cnoice oI selective réga-

latory measures has left the police power of thé

States undisturbed except as the state and federa

regulations collide.

R a, ; Santa Fe Ble i” to? ("or . 54 1 | 5 21 os } 5]

1947 (citations omitted

Turning to the specific legislation at hand, the NLRA

as amended.” we find that since first enacted in 1935

prevent al ( on Irom engaging 1 any unital abo}

practice defined by the Act affecting commerce

29 US. L160 (a “By this language, and by the defi-

nition of ‘affecting commerce (Congress meant to

reach to the full extent of its power under tne Com-

merce Clause.” Gus Utah Labor Board. 353 U.S. at

8. See 29 U.S.C. § 152(7)." Thus, in the area of labo

relations there is “not only a general intent to pre-empt

the field but also... the inescapable Implication of

exclusiveness.” Guss Utah Labor Board, 353 U.S. at

10. In Guss the Supreme Court went so far as to carry

that principle to the point of creating a no-man’s land,

In which no jurisdiction existed on behalf of state au-

thorities to intervene in labor relations matters covered

by the Act notwithstanding the Board’s refusal to exercise

dominion over such disputes. It should be noted that,

ilthough Gu involved unfair labor practices, the Act

uses substantially similar language regarding the repre-

sentation procedures established thereunder, and tnere-

. " ' 1° 1 ’ . ”

fore the principle established by Guss is of equal appli-

cation to representation matters

The situation created by Guss led in 1959 to the amend-

ment by Congress of Section 14 of the Act, allowing for

yA I ».4 152 7

The ter ffecting nmercs n in mmerce r bul

tructing commerce or the free flow of commerc

g led or tending to lead to a labor dispute burdening o1

tructing commerce or the free flow of commerce

See NLRB Bradford Dyeing A n, 310 U.S 18, 325-26 [6 LRRM

6384 1940 ynstru iy affect ny commerce

See 29 U.S.( 141(1 151, 152, 159 I r ex imple 159 ]

pi des that

Whenever a petit I shall nave been filed the B ard sh ill

nvestigate such petition and if it has reasonable cause to believ:

that a question of representation affecting commerce exists shall

provide for an appropriate hearing upon due notice em-

09a

tate intervention in labor disputes affecting commerce

in which the Board has specifically declined to exercise

irisdiction. Prior to that amendment, as is discussed

in Guss, id. at 6-7, a state could only intervene in a labor

dispute affecting commerce if the Board had entered into

a cession agreement pursuant to Section 10(a) of the

Act and then only if the state statute was consistent

W1tn a @ rresponding provision in the Act.

] The Board t ] ret I may, tf rule I decision

» 5 it i 1 ruk i pled purs tL to ibel iplel I] I

hapter 5 of Title 5, decline to assert ju tion over any labor

te involving any class category of employers, where, in

[ f the Board, the effect f such labor d spute ol

merce t sufficient! ipstantial to warrant the exercis¢

issert Jurisdiction under the standards prevailing upon Au

y t 1, 1959

2) Nothing this subchapter shall be deemed to prevent

bar any agency or the courts of any State or Territory (in

iding the Commonwealth of Puerto Rico, Guam, and the Virgin

Islands Irom assuming and asserting jurisdiction over labor

disputes over which the Board declines, pursuant to paragraph

1) of this subsection, to assert jurisdicti

29 U.S.C. § 160(a

The Board is empowered, as hereinafter provided, to prevent

iny person from engaging in any unfair labor practice (listed

in section 158 of this titl affecting commerce This power

hall not be affected by any other means of adjustment or pre

vention that has been or may be established by agreement, law,

wr otherwise: Provided, That the Board is empowered by agree-

ment with any agency of any State or Territory to cede to such

agency jurisdiction over any cases in any industry other than

mining, manufacturing, communications, and transportation ex

ept where predominantly local in character) even though such

ases may involve labor disputes affecting commerce, unless the

provision of the State or Territorial Statute applicabl to the

determination of such cases by such agency is inconsistent with

the corresponding provision of this subchapter or has received

a construction inconsistent therewith,

60a

Intervention in labor matters affecting cornmmerce to-

day is thus limited to cession agreements by the Board

with the states under Section 10(a) of the Act, or spe-

cific declinations by the Board to intervene pursuant to

Section 14(c) of the Act. There is a third category, also

under Section 14 of the Act,'* which allows the states to

legislate to prohibit union shop agreements.

The Supreme Court has recognized two types of fed-

eral preemption of state and local government action in

the field of labor law. First, the Supreme Court has

prohibited the states from regulating activities “which

are protected by Section 7 of the National Labor Rela-

tions Act, or constitute an unfair labor practice under

Section 8.” San Di go Bldq. Trades Council v. Garmon,

359 U.S. 236, 244 [43 LRRM 2838] (1959). Second, the

Court has held that state and local governments are pro-

hibited from regulating activities which Congress intended

to be left unrestricted by any governmental power. Lodge

76 Int’l Assoc. of Machinists & Aerospace Workers v.

Wisconsin Emp. Comm., 427 U.S. 182, 140 [92 LRRM

2881] (1976).

While both forms of preemption are implicated by this

appeal, the present case is indisputably controlled by the

Supreme Court’s holding in Golden State Transit Corp. v.

City of Los Angeles, 475 U.S. 608 [121 LRRM 3233]

(1986), which relied‘on and expanded upon the Machin-

ists doctrine.'* The similarities between Golden State and

the present case are considerable.

$29 U.S.C. § 164(b

Nothing in this subchapter shall be construed as authorizing

the execution or application of agreements requiring member

ship in a labor organization as a condition of employment in

any State or Territory in which such execution or application

is prohibited by State or Territorial law.

14[n Machinists, the Court had found unlawful a state commis-

sion’s prohibition against union refusals to work overtime during

collective bargaining negotiations. 427 U.S. at 148-49.

bla

In Golden State the employer sought renewal of a taxi-

cab operating license from the City of Los Angeles. At

the time the employer was engaged in a labor dispute

with the union that represented its employees. The City

Council conditioned renewal of the franchise on settle-

ment of the labor dispute by a specific date. When the

strike was not settled by that date, the franchise expired.

The Supreme Court ruled that the city’s action in condi-

tioning renewal of the franchise on settlement of the

labor dispute was preempted by the Act. The Court

stated, in language particularly apropros to the present

controversy :

Although the labor-management relationship is struc-

tured by the NLRA, certain areas intentionally have

been left “‘‘to be controlled by the free play of eco-

nomic forces.’ ” States are therefore prohibited

from imposing additional restrictions on economic

veapons of self-help, . . . unless such restrictions

presumably were contemplated by Congress. :

“(The crucial inquiry regarding pre-emption is the

same: whether ‘the exercise of plenary state au-

thority to curtail or entirely prohibit self-help would

frustrate effective implementation of the Act’s proc-

, ’*

esses.

Id. at 614-15 (citations omitted). The city’s insistence on

a settlement was preempted by the Act because it “ ‘en-

tered into the substantive aspects of the bargaining proc-

ess to an extent Congress has not countenanced.’” Jd. at

615-16 (citations omitted). This was so because “[t]he

NLRA requires an employer and a union to bargain in

good faith, but it does not require them to reach agree-

ment.” /d. at 616.

In the present case, the state’s intrusion into the bar-

gaining process is all-pervasive. The state not only man-

dates that a labor agreement be reached before a bid is

awarded, but dictates with whom that agreement is going

to be entered, and specifies what its contents shall be. For

62a

all intents and purposes the state here e/iminates the bar-

gaining process altogether. Regulation of this conduct ™

is clearly central to federal labor relations and cannot be

considered peripheral under the Garmon analysis. San

DP ego Unions v. Garmon, 359 U.S. at 243. See Be lknap,

Inc. v. Hale, 463 U.S. 491, 509 [113 LRRM 3057] (1983)

(third parties hired as strike replacements had state-

law causes of action based on misrepresentations by the

employer! ; Automobile Workers v. Russell, 356 U.S. 634,

635 [42 LRRM 2142] (1958) (state court jurisdiction

over common law tort action against union for mass

picketing upheld) ; Youngdahl v. Rainfair, 355 U.S. 131,

32 [41 LRRM 2169] (1957) (same re injunctive power

to prevent interference with free use of streets; Auto-

mobile Workers v. Wisconsin Emp. Rel. Board, 351 U.S.

266, 274 [38 LRRM 2165] (1956) (same re power to

enjoin violent union conduct) ; United Constr. Workers v.

Laburnum Constr. Corp., 347 U.S. 656, 657 [34 LRRM

2229) (1954) (state may exercise its historic powers over

such traditionally local matters as public safety and order

and the use of streets and highways); Allen-Bradley

Local v, W isconsin Emp. Rel. Board, 315 U.S. 740, 749

[10 LRRM 520) (1942) (same). Nor can it be con-

sidered that the “regulated conduct touche[s] interests

so deeply rooted in local feeling and responsibility that,

in the absence of compelling congressional direction, we

could not infer that Congress had deprived the States of

the power to act.” San Diego Unions v. Garmon, 359

U.S. at 244. The regulated conduct here is the labor

relations/bargaining process itself. Such processes have

been ruled upon by Congress as paramount to national,

not local interests. See General Electric Co. v. Callahan,

15 The fact that the state here has acted through its bidding regu

lations rather than its general law is irrelevant to our analysis,

as “judicial concern has necessarily focused on the nature of the

activities which the States have sought to regulate, rather than on

the method of regulation adopted.” Golden State, 475 U.S. at 614

n.5 (quoting San Diego Unions v. Garmon, 359 U.S. at 243).

63a

294 F.2d 60, 67 [48 LRRM 2929] (1st Cir. 1961), cert.

dismissed, 369 U.S. 832 (1962) (holding that a state

labor board’s interference with a labor contract negotia-

tion “conflict{ed] with the national policy of free and

unfettered collective bargaining” ).

Appellees contend that, had the Master Agreement been

entered into directly between the state agency and the

unions, it would be unassailable, because “[t]he National

Labor Relations Act leaves regulation of the labor rela-

tions of state and local government to the States.” ™

Abood v. Detroit Bd. of Education, 431 US. 209, 223

[95 LRRM 2411] (1977); 29 U.S.C. §152(2). The

state’s substantial participation in the Project, however,

is not enough to alter its status from regulator to em-

ployer. There are insufficient indicia of an employer

employee relationship between the MWRA and the labor-

ers.'" Rather, the state is in its common role of a third

party purchaser. Indeed, if the state employer exclusion

from the NLRA were interpreted to include all situations

in which a state contracted for goods or services, the ex-

‘6There are. of cour e, federal statutes other than the NLRA

which treat the actions of states and private parties differently.

See, e.g., the Sherman Antitrust Act, 15 U.S.C. §§ 1, 7 prohibiting

certain private conduct but exempting the states the Securities

al . ae

Act, 15 U.S.C. § 77 exempting government securities from the

Act’s provisions) ; the Civil Rights Act, 42 U.S.C. § 1983 (prohibit-

img cértain state conduct only

‘The distinction between an employee and an independent con-

tractor under the NLRA is to be determined by application of com-

mon law agency principles. See NLRB v. Amber Delivery Service,

Inc., 651 F.2d 57 [107 LRRM 3067] (1st Cir. 1981): Air Transit,

Inc. v. NLRB, 679 F.2d 1095 [110 LRRM 2630] (1982). Under this

tandard, the relationship between the construction workers and the

MWRA is a contracting, not an employment relationship. For ex-

ample, the MWRA does not have the right to control the laborers’

performance, nor does it pay their salaries, provide pension or other

benefits, or make FICA payments on their behalf.

65a

labor policy for the Nation to a centralized administra-

ve agency.’” Jd. (citations omitted).

Thus, although the MWRA’s attempt to regulate may

well pass scrutiny under the Commerce Clause, it cannot

survive under the NLRA. There should at this late date

ve no question that either because of its regulation of

matters protected by § 7 of the Act (e.g., the mandatory

recognition of the Trades Council), San Diego Unions v.

Garmon, 359 U.S. at 245, or because of its direct intru-

ive bargaining process, Golden State

Transit Corp . City of Los Angeles, 475 U.S. at 614-

15, Specification 13.1 frustrates the purposes of the Act

ind therefore must fall under the doctrine of pre-

B Section 8(e) and (f) of the Act The Construction

Miu f) j exemption

Appellees argue, and the District Court in effect ruled,

hat the provision of Sections 8(e) and (f) of the Act

alidate the Master Labor Agreement “in the context of

the unique conditions which exist in the construction

section Sle) of the Act’ makes it an unfair labor

practice for an employer and a union to enter into what

| , Los. tale in part

It shall be an unfair labor practice for any labor organization

d any employer to enter into any contract or agreement,

Kpres r implied, whereby such employer ceases or refrains

r agrees to cease or refrain from handling, using, selling, trans

porting or otherwise dealing in any of the products of any other

mployer, or to cease doing business with any other person, and

ny contract r agreement entered into heretofore or hereafter

ntaining such an ayreement shall be to such extent unenforce

ible and void: Provided, That nothing in this subsection shall

ly to an agreement between a labor oryanization and an

employer in the construction industry relating to the contracting

or subcontracting of work to be done at the site of the con

struction, alteration, painting, or repair of a building, structure,

or other work

66a

. ;

— ‘ ; > . ‘ 0 wnt

mmoniy\ ferred to a a ne cargo agreement.

/. ,

. y ry ; . } , .

naer a I Cart : reeme! ypenerally, the employer

nds itseli ! } Dusiness With al ner empit yer Or

) , TT} + t YPaAPTY nt i TY) j out f +1).

SO] ines ype ft agreements develope ] u

‘ ‘ + ™ . +

lions in which unions did 1 want their members to be

;

- y - } y **o¢ ; ao »t ~ " ‘

rking y and ng Struck roods section é , how

. ‘ ‘ . 4+ » ¢ . . rot wt) .

e! nlains a im eq exemption Io? ne construction

++ ‘ ‘ tra nt . : . ‘

IUSLI\ } LLInY ne contracting r supcontras ny

¢ ‘ 99 T}

. : ‘ + 4 ‘ ; + y07 y We

wort ne adone a ne site of ne nstructio nu

+ ¥ YY nr ay cy 7 TY? YY wil ’

, s - “A ® ee ‘ ~~ alt ic} « _ ‘ sa 7 riVveu

"dj

; Pe +> +w13,704 scot

e! I ONSLFul On InNauslLry

Q tor xi f of the A ‘ creates an ther except y

. 4 } ‘ ‘ — —_—

r the building and cons ion industry by allowing

) ro. 4

? r r ’ ‘ ’ ’ ’ y P P

’ f 4} out Snes emr er ¢ y ‘ nrir

, le , ;

" tru I Ll! t make yre ‘

, wr ier ’ y | ? r a’? ry The r ery

- " . x | VV A}

> ‘ »

ry ¥ : | “Mr r , ] j y na yy ’

rganizat I wil mn pull ny na

ees ré memher , t eetald 7 ry , ‘

I i a a

} if : ‘ ‘

" it ' ~ ' j ’

’ ’ , , to ‘ ’ y

t+. had nder the , mn of sect , ‘

; ; ‘ making Tes ag? ement y ? } r

y ' ’ t wernt mer? rnertwe? }

a |

rya ‘ , ftor +} seventh sy f ou gy th ‘

, ry , rt yr +} {¥ ; 4-4 f t) vrs ry

iT f ‘ ( eTT e¢ ® aatle ¢ e ay ‘

ever . ter r sucn agreement require Lt? er

notify such labor organization of opportunities for en

wit! h employer, or gives such labor organiz: na

4 nity te refer q fied applicable f r such empl yment ; 4

suct greement spe fes minimum training r experience j

fications for employment or provides for priority in opportur

ties for employment based upon length of service witl ict

employer mn the industry or in the particular geograpl

area Provided, That nothing in this

subse |

the final proviso to subsection (a 3) of this

’

further, That any agreement which v

clause ] of! this subsection shall rie

ile d purs jant Ww section 159 or 159

he a

Tal

on: Provided

Walid, but for

lo a petition

“) of this title.

67a

certain actions, which would otherwise be prohibited as

unfair labor practices, by employers and unions in that

line of work. Thus a construction industry employer may

enter into a so-called “pre-hire” agreement with a union,

e.g., a collective bargaining agreement wherein the un-

ion’s representative status is immaterial and in fact is

usually entered into prior to the hiring of any employees.

Furthermore, such an agreement may contain a union

shop provision requiring membership in the union seven

days after hiring, 29 U.S.C. § 158(f) (2), which would

otherwise be illegal; *' a requirement that the employer

notify the union of job openings giving the labor organiza-

tion an opportunity to refer qualified job workers, 29

U.S.C. § 158(f) (3); as well as a condition establishing

minimum training or experience qualification and area-

wide senority. 29 U.S.C. § 158(f) (4)

A construction industry labor contract entered into un-

ler the exceptional provisions of Section 8(f) is not, as

ecifically stated in the final proviso of that section, a

r to a petition for election, be it by a rival union,” by

ployer or by the employees themselves.** If the

yees elect a rival union as their bargaining agent,

her the winning union nor the employer are required

ime the 8(f) contract. If the employees reject the

ntracting union as their bargaining agent and

choose another bargaining agent, the contract is

void because one of the contracting parties is dis-

ified

It apparent from the above that under the excep-

ons established by Sections Zie) and (f) of the Act,

the Master Labor Avreement between the Trades Council

and Kaiser, Is a valid labor contract. See Jim McNeff,

Inc. v. Todd, 461 U.S. 260, 265-66 [113 LRRM 2113]

*! The usual provision is 30 days. See 29 U.S.C. § 158 (a) (3)

2229 ULS.C. § 169(¢)(1)(A)

4929 U.S.C. § 169(¢c) (1) CB

2429 U.S.C. § 169(e) (1).

(1983). That conclusion, however, is irrelevant. Appel-

lants do not challenge the validity of that agreement, they

contest the legality of Specification 13.1, which establishes

recognition of the Trades Council and signing of the

Master Labor Agreement as a condition of the award of

an MWRA bid. On said issue, Sections 8(e) and (f)

have no bearing, except as reinforcement for appellants’

preemption arguments. It is clear, both from their nature

and history, that Congress extensively debated and con-

sidered these controversial provisions before their enact-

ment. See generally, 1959 U.S. Code Cong. & Admin.

News. p. 2318. It is unlikely that Congress intended to

leave open to Balkanization by the states, such core areas

as unfair labor practices and collective bargaining, which

are the matters inescapably arising from Sections 8(e)

and (f) problems. There can be no question but that in

enacting these exceptional provisions Congress occupied

the field to the exclusion of Specification 13.1. Guss v.

Utah Labor Board. 353 U.S. at 10. In short, although the

Master Labor Agreement is a valid contract pursuant to

Sections 8(e) and (f) of the Act, Specification 13.1 must

be struck down as unduly interfering with the area of

labor negotiations Congress intended to leave unregulated

under the same statute.

C. State interests

The district judge, in a commendable attempt to har-

monize the irreconcilable conflicts presented by this diffi-

cult case, reasoned that even if the Master Labor Agree-

ment “were to have some impact on NLRA-regulated

conduct, that impact must be considered in the light of

important state interest, namely the scheduled and court-

ordered completion of the harbor clean-up expeditiously

and without unnecessary expense.” In effect, the court

held that this public purpose sanitized its constitutional

shortfalls. While we do not totally fault the court’s

efforts in this respect, nor disagree as to the importance

of the Boston Harbor clean-up, it cannot be said that con-

69a

gressional concern for a uniform, national labor policy as

embodied in the NLRA, is entitled to secondary deference.

There are few areas in which local interest can be more

legitimately exercised than in protecting the public from

financial hardship caused by fiscally irresponsible persons

using the state highways. Yet the Supreme Court invali-

dated a state statute whose purpose was resolution of

such a dilemma because it concluded that it conflicted

with the Federal Bankruptcy Act. Perez v. Campbell, 402

U.S. 637, 656 (1971). The Court rejected the argument

that the purpose of the state law, rather than its effect on

the operation of federal legislation, should govern its

validity. Even if the state claimed to be concerned with

promotion of highway safety, such a statute could not

stand if it conflicted with the federal scheme: “[{S]uch a

doctrine would enable state legislatures to nullify nearly

all unwanted federal legislation by simply publishing a

legislative report articulating some state interest of policy

other than frustration of the federal objective—that

would be tangenitially furthered by the proposed state

law.” Jd. at 652.

Although the local concerns that led to the promulga-

tion of Specification 13.1—“labor harmony during [the]

life... [of] ... this critical project”—are laudable,

they conflict with paramount federal law and must there-

fore fall. We should add that we are in any event some-

what skeptical of the pax industrial which the Master

Labor Agreement utopically promotes. This peaceable

kingdom may be somewhat less than attainable consider-

ing that this contract is no bar to rival, or for that

matter, anti-union, activity. See 29 U.S.C. 5 158(f),

last proviso.

1) Other Allegations

In view of our ruling on the issue of preemption of

specificati m 13.1 by the Act, it is unnecessary for us to

reach the other questions raised by the appeal. See Lane

Cir. 1939

VI. CONCLUSION

Specification 13.1 unduly restricts aspects of the labor-

management relationship intentionally left unregulated

by Congress and is thus preempted by the National Labor

Relations Act, as amended. 29 U.S.C. § 151, et seq. The

decision of the district court is reversed and mandate

shal] issue forthwith with instructions to the district court

that it issue an order preliminarily enjoining enforce-

ment of Specification 13.1.

Re erse d and rema nde d.

7la

APPENDIX C

UNITED STATES DISTRICT COURT

DISTRICT OF MASSACHUSETTS’

Civil Action No. 90-10576-MA

ASSOCIATED BUILDERS AND CONTRACTORS OF

MASSACHUSETTS/ RHODE ISLAND, INC. et al..

Plaintiffs

vs.

THE MASSACHUSETTS WATER RESOURCES AUTHORITY,

et al.,

Defendants

MEMORANDUM AND ORDER

Mazzone, D.J. April 11, 1990

This is an action for damages, injunctive and declara-

tory relief, at the heart of which is the Boston Harbor

clean-up project. The plaintiffs, Associates Builders and

Contractors of Massachusetts/Rhode Island, Inc. (ABC),

its national organization and five individual contractors,

seek to enjoin the defendants, The Massachusetts Water

Resources Authority (MWRA), its project manager,

Kaiser Engineers, Inc. (Kaiser), and the Building and

Construction Trades Council (Council), from enforcing

Specification 13.1 of the MWRA’s bid procedures. Speci-

fication 13.1 requires that all successful bidders on con-

struction contracts affecting the harbor clean-up agree to

observe the Boston Harbor Wastewater Treatment Facili-

ties Agreement (Agreement). The Agreement, in turn,

requires that the Council’s member unions, thirty-four in

all, serve as the exclusive bargaining representative for

72a

all employees on project contracts; that all employees

must be referred by local union hiring halls; that all

employees are subject to the union’s compulsory member-

ship provisions: that all employees are governed by the

unions’ wage and benefit provisions, contributions, and

union work rules and job classifications.

The plaintiffs’ position is straightforward. They claim

that without injunctive relief, the plaintiffs are effectively

prevented from obtaining work on this multi-billion dol-

lar, ten-year, public works project. Affidavits submitted

by ABC, its national organization and the plaintiff con-

tractors allege that all construction contracts should be

awarded to the lowest, responsible bidder through open

and competitive bidding regardless of labor affiliation.

If this practice were followed, they say, the taxpayers

and consumers would receive the most value for their

construction dollar. These non-union contractors, though

ready, willing and ab’e to perform on project contracts

have not, and will not bid on any contracts because of

the restrictive requirements of the Atreement. They seck

damages for violations of the anti-trust provisions of

the Sherman Act, 15 U.S.C. $1, and certain state com-

mon law torts. They also seek a declaratory judgment:

that the Agreement is pre-empted by the National Labor

Relations Act (NLRA) and the Employee Retirement

Income Security Act (ERISA); that the Agreement

denies the plaintiffs’ due process and equal protection

rights under the state and federal constitutions; and,

finally, that the Agreement violates the Massachusetts

public bidding statutes.

On that record, the plaintiffs claim they have satisfied

the criteria necessary for injunctive relief, namely: they

have demonstrated a likelihood of success; will suffer

immediate and irreparable harm if relief is not granted;

such harm outweighs any harm to the defendants, and,

the public interest will not be adversely affected. Plan-

ned Parenthood v. Bellotti, 641 F.2d 1006, 1009 (lst

73a

Cir. 1981). Pursuant to Rule 52, Fed. R. Civ. P., and

after review of the entire record. including all affidavits,

and after hearing, I make the following findings of fact

and conciusions of law.

The MWRA is responsible for the Boston Harbor

clean-up pruject pursuant to orders and a schedule estab-

lished by this Court. See Memorandum and Orders issued

on September 5, 1985, December 23, 1985 and May 8,

1986, in United States of America v. Metropolitan Dis-

trict Commission, et al., Civil Action No, 85-489-MA. In

April, 1988, the MWRA retained Kaiser as its program

construction manager. Kaiser’s primary function is to

manage and supervise the ongoing construction activity.

In the course of performing its function. however, Kai-

ser could be expected to employ craft labor in certain

Situations. Its agreement with the MWRA permits it to

act as an execution contractor or to perform certain

direct hire work as needed in cases of default or incom-

plete performance by other contractors, clean-up work,

and other limited or emergency situation. Another im-

portant function of Kaiser was to advise the MWRA on

the development of a labor relations policy which would

maintain worksite harmony, labor-management peace and

overall stability during the ten year course of the proj-

ect. The MWRA had already experienced work stop-

pages and informational picketing at various sites and

was concerned that because of the scale of the project and

the number of different craft skills involved, the project

was vulnerable to numerous delays, thus placing the

court-ordered schedule in jeopardy and subjecting it to

the contempt orders of this Court. This concern was

enhanced by the geographic location of the existing and

proposed treatment facilities, especially at Deer Island

where access to the site was by a single two lane road,

through crowded Winthrop streets, and past the existing

Suffolk County House of Correction. Access to the facil-

74a

ity at Nut Island is similarly constrained. Proposed fa-

cilities being built off-island to transport workers, con-

struction material and equipment across the harbor to

Deer Island would have to be designed or adapted to the

potential for labor unrest with unions other than member

unions of the Council, such as the maritime workers’

union.

Kaiser, by virtue of its extensive experience on large

construction projects and its dealings with hundreds of

building trade unions, recognized and understood the

need for labor peace and stability on a project of this

magnitude. It was aware that the MWRA was operating

under court-mandated milestones and it knew of the sig-

nificant union presence in the Boston area. A major con-

cern was the location of the work sites and the pressure

points at which labor demonstrations could choke the

movement of personnel and material. Accordingly, Kaiser

recommended to the MWRA that it be permitted to nego-

tiate with the building and construction trades unions,

through the Council, in an effort to arrive at an agree-

ment which would assure labor stability over the life

of the project. Any agreement was subject to review and

final approval of the MWRA.

The MWRA accepted Kaiser’s recommendations and in

early May, 1989, negotiating teams from the unions and

Kaiser met. The Agreement was the result of their nego-

tiations. Its principal provisions were standardization of

working conditions for all construction employees, par-

ticularly hours and travel pay, a ten-year no-strike clause

and an effective and expeditious dispute resolution mecha-

nism. After review of the MWRA staff and upon its

recommendation, the MWRA Board of Directors, on May

28, 1989, adopted the Agreement as the labor policy for

the project and directed that Specification 13.1 be added

to the bid specification for all new construction work.

The purpose was to achieve jobsite labor harmony in order

to maintain the court-ordered schedule and avoid the

75a

risk of substantial fines for non-compliance. In the ab-

sence of such an agreement, legitimate labor disagree-

ments and demonstrations would lead to delays in con-

struction, resulting in increaséd costs to the MWRA.

And, of course delays will mean that Boston Harbor

would continue to be subjected to environmental abuse.

Against this factual backdrop, I turn to the criteria

for injunctive relief. I focus primarily on the likelihood

that the plaintiffs will succeed on the merits and their

claims and deal seriatim with the specific grounds as-

serted.

l. Pre ¢ moption Unde r the NLRA

The plaintiffs say that because the MWRA, a public

agency, has dictated the terms of the Agreement under

which the ABC contractors can work, but has not allowed

those contractors to participate in the negotiations that

produced the Agreement, it has impermissibly intruded

into the area of labor law preempted by the NLRA. Cit-

ing Golden State Transit Corp. Vv. City of Los Angeles,

475 U.S. 605 (1986) and Hydrostorage, Inc. v. Northern

California Boilermakers Local Joint Apprenticeship

Commitice, 285 F. Supp. 718 (N.D. Cal. 1988), aff'd. 891

F.2d 719 (9th Cir. 1989); the plaintiffs’ claim that the

NLRA guarantees them the right to bargain independ-

ently with only those unions designated by their own

employees. Therefore, the question presented is whether

by virtue of the Agreement, there has been some inter-

ference by either the MWRA or Kaiser in an area which

Congress soucht to leave unrevu'ated.

As clear as the plaintiffs posit their claim, it is equally

clear that Congress addressed that claim in the context of

the unique conditions which exist in the construction in-

dustry. Sections 8(e) and 8(f), NLRA; Connell Con-

struction Co. Vv. Plumbers & Steamfitters Local 100, 421

U.S. 616 (1975). Section 8(e) contains a proviso ex-

pressly permitting restrictive agreement which bind other

76a

secondary employers, such as the plaintiffs, when, as is

the fact here, Kaiser plans to employ some employees at

the site. Morrison-Knudsen Co., Inc. NLRB Advice

Memorandum, March 27, 1986. Section 8(f) allows con-

struction labor agreements that condition employment

upon a willingness to abide by union rules, even though

the employees did not designate the union as their rep-

re sentative. NLRB V. lronworkers, 434 U.S. 335. These

special privileges for the construction industry were neces-

sary, Congress found, to alleviate the serious problems

arising out of the unique practice of the construction

industry. NLRB V, lronworkers, supra, Woelke & Ro-

mero Framing, Inc. v. NLRB, 456 U.S. 645 (1982).

Even if this Agreement were to have some impact on

NLRA-regulated conduct, that impact must be consid-

ered in the light of important state interests, namely the

scheduled and court-ordered completion of the harbor

clean-up expeditiously and without unnecessary expense.

The scope of preemption requires an examination of “the

state interests in regulating the conduct in question and

the potential for interference with the federal regulatory

scheme.”’ Furmer V. United Brotherhood of Carpente rs,

430 U.S. 290, 297 (1977); Beckwith v. United Parcel

Service, luc., No. 89-1476, slip op. (1st Cir. November

16, 1989). This critical project compels labor harmony

its life. Given the many, different crafts involved, and the

number of separate contracts necessary and the proba-

bility of local, isolated, jurisdictional disputes among

represented employees could bring the project to a halt

at any time and on a perfectly lawful basis. The presence

of non-represented employees simply increases the poten-

tial for continuous strife and crippling work stoppages.

Under the circumstances present in this case, I believe

the Agreement is lawful.

77a

_ a Pre f mptvor Under ERISA

Pursuant to Section 514(a), 29 U.S.C. § 1144(a),

ERISA preempts all state laws which relate to an em-

ployee benefit plan. The plaintiffs claim that this Agree

ment requires employers to contribute to trust funds and,

thus, it purports to regulate the terms and conditions of

employee benefit plans as defined by Section 514(c).

Hydrostorage, Inc., supra.

Unlike the situation presented in Hydrostorage, supra,

this Agreement applies to a single, discrete project. It

does not apply to all state contracts or to all employers

doing business in the state. The state’s concern here is to

maintain labor harmony on a single, albeit large, public

works project that presents the variety of problems set

out above. The Agreement does not purport to regulate

the terms and conditions of employee benefit plans. Sec-

tion 514(c), ERISA. No specific plan or benefit is man-

dated. The agreement simply requires successful bidders

tu abide by negotiated conditions which can be altered

or modified during the life of the contract. Whatever

effect the Agreement may have on employee benefit plans

is to remote or peripheral to constitute state law. Wis-

consin Department of Industry, Labor and Human Rela-

tiovs V. Gould, Inc., 475 U.S. 282, 281 (1986). Shaw v.

Delta Airlines, 463 U.S. 85, 100 n.21 (1983).

3. The Fourteenth Amendment Claims

(a) Eq ial Protection

The plaintiffs claim. that in reacting to a threat of

labor unrest, the MWRA is effectively sponsoring dis-

crimination against non-union contractors, and discrim-

inating in favor of organized labor. City of Richmond Vv.

J.A. Crowson, 109 S. Ct. 706 (1989).

This argument fails for two reasons. First, non-union

contractors do not constitute a protected class for pur-

“ao

ida

poses of equal protection analysis. Hoke Co. V. TVA, 854

F.2d 820, 828 6th Cir. 198s All contractors are in

vited to bid on tl ame terms. No contractor is favored

inder the bid procedures even though a non-union con-

tractor may be required to conform to certain terms and

conditions under which a union contractor already oper

tes. Secondly, if there were disparate treatment, the

state’s interest in elimina.ing disruption and delay on the

project provides a rational basis for the Agreement

Dandridge Vv. Williams, 397 U.S. 471 (1970

Diaintitis cialm tna DV Incorporating the Agree

‘ ‘ ++ } ] . laa y } Wp : ly

ment into its bid procedures, the MWRA is effectively

" ; +) ) ‘ . ' ‘ : P ae : .

precluding the plaintiff contractors from bidding, and

thus, is depriving non-union contractors of a protected

perty interest in an award or consideration for a con-

First, the plaintiff contractors have not bid on any

contract and, therefore, cannot claim that they were

‘ied access to the bidding process or denied the fair

application of the bidding procedures. Smith & Wesson

v. United States, 782 F 2d 1074 lst Cir. 1986); Three

Rivers Cablevision, Inc. V City of Pittsburgh, 502 F.

upp. 1118 W.D. Pa. 1980). Moreover, they are unable

to specify any entitlement to a contract, otner than to

voice a desire to bid unencumbered by the terms of the

Agreement. This is not suffiicent to establish a constitu-

tionally protected right under the Fourteenth Amend-

ment Board of Regents V. Roth, 408 U.S. 564, 577

1972). Accordingiy, the plaintiffs have not been denied

a fair consideration for the award of any contract.

4 Violation of the Sherman Act, 15 U.S.C 5 1

The plaintiffs claim that the Agreement and its incor-

poration by Specification 13.1 demonstrates a conspiracy

among the defendants, fueled by the coercive tactics of

79a

‘

the construction industry by effectively precluding non-

union contractors from bidding on harbor clean-up con-

trac

Again, it must be pointed out that the plaintiff con-

tractors have not been excluded from bidding. They

simply have refused to bid on any contract because of

what they term is their principled unwillingness to sub-

mit to the conditions laid down by the MWRA. Even if

the MWRA’s position could be termed a refusal to deal,

such a refusal would not be unreasonable. The MWRA’s

purpose has always been to maintain the court-ordered

schedule at the greatest cost savings by reducing the po-

tential of work stoppages due to labor unrest. This

Agreement serves a legitimate business, and public pur-

pose and, thus, does not violate the anti-trust laws. E.g.,

Auburn News Co. Vv. Providence Journal Co.. 659 F.2d

eid, 278 (lst Cir. 1981); cert. denied, 454 U.S. 921

1982). Moreover, the state action doctrine bars this

claim. Parker v. Brown, 317 U.S. 341 (1943). As a

state entity the MWRA is immune from an anti-trust

claim. Interface Group, Inc. Vv. Massachusetts Port Au-

thority, 816 F.2d 9, 13 (1st Cir. 1987). This doctrine

also bars the anti-trust claims against Kaiser. See South-

ern Motors Carriers Rate Conference, Inc. v. United

States, 471 U.S. 48, 56-59 (1985).

Finally, the claim against Kaiser and the Council is

based on their execution of the Agreement. That claim

is barred by Section 8(e) of the NLRA and labor’s non-

tatutory anti-trust exemption under the Sherman Act.

As the facts show, Kaiser’s employees will be covered by

the Agreement and, thus, Kaiser will be treated in the

same manner as all other contractors. Woelke & Romero

Framing, Inc. Vv. NLRB. supra

~) T he Massac } Hise tts Public Bidding Statute Ss

The plaintiffs next claim is that the Agreement vio-

lates the public bidding statutes of Massachusetts, be-

The nort ans\ ! oO ( ] is | ne language o!

the statutes Passing the question of standing to raise

this : ¢ u! Statutes require the MWRA to award

work to the “lowest responsible and eligible” bidder who

‘shail certify that it is able to furnish labor that can

work in harmo! with all the other elements of labor

em ved or | pe em) ved oO! the wi rk v (5 ™ ce. 30

IGM i G.L. ¢«. 149 § 444A] The MWRA has the

authority to make that determination and its determina-

tion W be upneid uniles t 18 arbitral capricious oO}

YY 14 y } i ‘ } 7 / ( ; , tr "onst) vr ,

C‘ompa) / \ Va achusetts Pi rt Authonty, 369

Mass. &25 (1975 See also Opinion of February 16

1990) | x 6 ] ‘ (fice OT Labo} ey rtment of! Labor

and Industries, Exhibit D to Complaint

f }

hese aims {f for 3 ariet f re ! ome of

which are discussed above nd the remaining issues re

guire ! ry re tna? i brel note There can be no inte!

ference with advantage is Dusines relationsn)} pneca use

the MWRA has not refused, nor will it refuse to ente

into any contract that conforms to the terms of the

Agreement, nor is there anything in the record to show

that Kaiser or the Council Is procuring or attempting to

procure such refusals. The state constitutional and civil

rights claims like their federal counterparts above, fall

to identify the particular right or interest which has been

violated or denied. See generally Associated Builders and

Contractors of Kentuckiana, ln and River City Devel

opme? f Corporation V. Ohbauyash Corporation, No. &7-3%

(D. Ky. October 26, 1987)

ITT.

Based on the foregoing findings and conclusions, the

plaintiffs are not entitled to preliminary injunctive re-

lief,

1. As the above discussion indicates, the plaintiffs have

failed to demonstrate a likelihood of success in the merits.

‘)

2. The plaintiffs will suffer no immediate and irrepar-

able injury. After waiting over nine months to bring this

motion, the plaintiffs have not bid on any contract for

which they claim they are eligible. Had they bid and

been awarded a contract, they would have suffered no

harm.' Had they bid and been denied a contract, they

ld be in a position to claim damages if the Agree-

ment were later shown to be illegal.

3. The harm to the plaintiffs is outweighed by the

harm to the defendants. First, the plaintiffs are not pre-

cluded from bidding. And since the plaintiffs agree they

must pay at least the prevailing Wage on this project,

their harm appears limited to a violation of their an-

nounced principle that they should not be required to

recognize unions and union regulators that have not been

designated by their employees. Other than this project,

the non-union contractors are free to operate on their

own terms on any other job and they are free to litigate

At hearing insel for ABC advised the Court that one r!

led by the MWRA to DEC-TAM Corporation, a non-union

ctor, had be cancelled because [ the Ayreement An affi

davit ipporting that statement was later filed by the executive

pre lent f AK

That affidavit was followed hort order by an affidavit from

the MWRA indicating that the contract, for asbestos removal from

there engines, was not for ervices subiect to the \greement and

was awarded to the only bidder in response to limited advertising

\fter work was completed on one engine which was urgently needed

the contract’ was cancelled because the other two engines were in

uMciently good condition for emergency, standby duty and the price

was too high. If further work were needed, the MWRA will adver

tise more extensively to obtain the lowest price

82a

the validity of the Agreement and, if successful, estab-

lish their damages.

On other hand, the defendants will suffer serious harm

in the absence of this Agreement. Disruption, delays and

increased costs to the ratepayers and taxpayers are vir-

tually certain to occur without the means to eliminate the

basic conflicts and without the mechanism to resolve an-

ticipated disputes.

4. The publie interest will be adversely affected were

the injunction to issue. As the foregoing makes evident,

the Agreement insures that the long overdue harbor clean-

up will not be delayed by labor disharmony. The right

of the public to an unpolluted harbor, maintaining the

schedule for the clean-up and controlling its cost are vital

concerns.

The plaintiffs are careful to point out that they do not

seek to delay the Boston Harbor clean-up project, but

only to provide high quality construction work at lower

costs, with greater flexibility and freedom than would be

possible if they were to operate under restrictive union

agreements. They are also careful to say they do not

oppose the entire Agreement, and would be bound by the

no-strike clause, most of the dispute resolution provisions

and standardized work hours. They simply oppose those

provisions which compel recognition of unions or which

compel them to adopt specific union contracts.

This position seems to ignore Congress’ purpose in en-

acting Sections 8(e) and &(f), NLRA, to address the

reality of the unique conditions in the construction in-

dustry. That reality is present in the circumstances of

this case, and under those circumstances, I conclude the

Agreement is not unfair or illegal.

Accordingly, the motion for preliminary injunction Is

denied.

SO ORDERED.

s/ A. David Mazzone

United States District Judge

S3a

APPENDIX D

UNITED STATES GOVERNMENT

NATIONAL LABOR RELATIONS BOARD

; MEMORANDUM

Date: Jun 25, 1990

Ss(e) Chron, 8(f) Chron, 584-5000

Rosemary Pye, Regional Diector

Region 1

FROM

Harold J. Datz, Associate Genera] Co Insel

Division of Advice ‘

SUBJECT

Building & Trades Council, et al

(Kaiser Engineers, Inc. )

Case 1-CE-7]

This Case Was submitted for advice as to: (ta) whether

a4 provision In a contract is a “hot cargo” agreement: and

(b) if so, whether it is privileged by the construction

industry proviso of Section 8(e)

Facts

The Massachusetts Water Resources Authority

(MWRA) is responsible for the Boston Harbor clean-up

project under a federal court order pursuant to the Clean

Water Act. In April 1988, the MWRA chose Kaiser

Engineers, Inc. (Employer), a well know general con-

‘The court order also imposes a time table for the project which

involves construction of wastewater treatment facilities for the

Boston Harbor.

tractor and construction manager, to be the program

construction manager tor the project.

As construction manager, the kn pioyer 1 required to

manage and supervise the project, including planning,

procurement, budget, scheduling and labor relations mat-

ters. Because of concerns about possible conflicts of in-

terest arising from the program ‘construction manager's

role. the MWRA has barred the Employer from bidding

on any of the construction work for the project. How-

ever, with MWRA approval, the Employer intends to em-

ploy construction trades employees on the project in cer-

tain limited circumstances.

In May 1989, the Employer entered into a project

agreement (Agreement) with the, Building and Trades

Council and approximately 40 local and international

construction trade unions (Unions) for the construction

work on the Harbor project. The Agreement provides

standardized working conditions for all construction em-

ployees.* It also provides that all construction subcon-

tractors must agree to be bound by the Agreement.

In March 1990, the Associated Builders and Contrac-

tors of Massachusetts Rhode Island (ABC) brought a

civil action, including a request for a preliminary injunc-

tion, attacking the legality of the Agreement on various

M.G.L. Chapter 30, de M re } ' work pet

formed for the Commonwealth of Massachusetts must be put out t

pid if the st { that work exceed $5.U Ay T he MWRA and tne

Employer agree that the Em; ! aim ru

work in cases of defa I ‘ et vl rma I otner co!

tractors, clean-up and temporary work, and ther limited emer!

gency situations which would st $5,000 or 5

There is no contention that the Employer acted as an agent oO!

MWRA rather than as a principal when it sig! the Agreement

4 Article II of the agreement provides that any struction work

the Employer performs will also be covered by the Agreement.

85a

grounds.’ On April 11, 1990, the district court denied

the request for preliminary injunctive relief. The court

found, inter alia, that the Agreement was lawful under

the proviso to Section 8(e) and under Section &8(f).

On March 14, 1990, the Utility Contractors Association

of New England (UCA) filed the instant charge alleging

that the Agreement was in violation of Section 8(e).

UCA contends that the provision is not privileged by the

construction industry proviso to Section 8(e) since the

Employer does not and will not employ any employees on

the project.” UCA further contends that even if the Em-

ployer employs any craft employees the Agreement is

still not valid as it was entered into by the MWRA as a

result of unlawful secondary pressure. In this regard,

UCA relies on picketing by several Unions at other

MWRA jobsites prior to the negotiation of the Agree-

ment, Lastly, the UCA contends that even if the Agree-

ment is lawful in general, it is unlawful with respect to

surveyors since it does not cover surveyors employed by

the Employer.

Action

We conclude that the provision is a “hot cargo” agree-

ment within the ambit of Section 8(e). We further con-

clude that the provision was lawful under the construc-

tion industry proviso to Section 8(e).

Initially, we concluded that the clause is a “union sig-

natory” clause and is secondary and within the ambit of

8(e). The agreement between the Employer and the

5 Among other grounds, ABC argued that the Agreem«s nt, whose

terms were approved by the MWRA, was preempted by the NLRA

*UCA disagrees with MWRA and the Employer that the Em

ployer can perform certain construction work on the project. It

argues that the Employer is prohibited by state law from doing any

construction work on the project without first bidding for it. Since

the MWRA has barred the Employer from bidding on any construc

tion work, the UCA argues that the Employer wil! not be able to

perform any construction work on the project.

86a

Unions requires that all subeontractors on the site must

be bound by the Agreement.’ In essence, the Employer

cannot do business with companies who do not agree to

bound to the Union contract. Thus, the Agreement would

violate Section 8(e) unless it is encompassed by the con-

struction industry proviso to Section 8(e).

The Supreme Court has held that the construction in-

dustry proviso to Section 8(e) authorizes a “union sig-

natory” clause by a union and an employer in the con-

struction industry in the context of a collective bargain-

ing relationship.* In the instant case, it first must be

determined whether the Employer is an employer in the

construction industry. The Employer is a _ well-known

general contractor and construction manager. Indeed, in

the instant case, the Employer’s main responsibility is to

supervise the project, including planning, procurement,

budget, scheduling, and labor relations. In addition, the

Employer will employ employees on the project. Where,

as here, an employer’s principal business is in the con-

struction industry, and it is acting as an employer of

construction employees on the particular project, it is

clear that such an employer is “an employer in the con-

struction industry” for purposes of Section 8(e).° More-

over, even if an employer’s principal business is not in

the construction industry, but it acts as the general con-

tractor on a specific construction project, the Board finds

it to be an employer in the construction industry based

on the degree of control it retains over the labor relations

at the jobsite.'° As noted, supra, the Employer’s prime

7 Orange Belt District Council of Painters No. 48 (Maloney Spe-

cialties, Inc., 276 NLRB 1372, 1887 (1985).

8 See Connell Construction Co. v. Plumbers Local 100, 421 U.S

616, 633 (1975)

®* United Brotherhood of Carpenters and Joiners of America

(Longs Drug Stores, Inc.), 278 NLRB 440, 442 (1986).

10 Los Angeles Building & Construction Trades Council (Church's

Fried Chicken, Inc.), 183 NLRB 1032 (1970).

87a

responsibility in this case is to supervise labor relations

on the jobsite.

Next, it must be determined whether the Agreement

was entered into in the context of a collective bargaining

relationship. A Section 8(f) relationship satisfies this

requirement."' In the instant case, the Employer entered

into a Section 8(f) pre-hire contract with the Unions.

The Charging Party contends that there can be no

bargaining relationship of any kind unless the Employer

hires and intends to hire employees covered by the Agree-

ment. The General Counsel has authorized 8(e) proceed-

ings where the employer did not hire and did not intend

to hire any construction employees.* However, in the

instant case, the Employer intends to employ craft em-

ployees on the project, and these employees will be cov-

ered by the Agreement.'* Thus, it is clear that the Em-

ployer entered into a valid Section 8(f) relationship.

Accordingly, the Agreement is protected by the proviso.

This conclusion is consistent with the district court’s

opinion.

Furthermore, we conclude that there is insufficient evi-

dence to find that the Agreement was entered into as a

result of unlawful secondary pressure. The picketing has

not been established as unlawful. In addition, the picket-

\! Los Angeles Building & Construction Trades Council (Donald

Shriver, Inc.), 239 NLRB 264, 267-70 (1978 ), enfd. 635 F.2d 859,

872-876 (D.C. Cir. 1980), cert. denied 451 U.S. 976 (1981); A.L.

Adams Construction Co. v. Georgia Power Co., 557 F.Supp. 168,

174-77 (1983), affd. 733 F.2d 853, 856-58 (11th Cir. 1984), cert.

denied 471 U.S. 1075 (1985

12 Plumbers Union Local 246 (Marlin Mechanical, Inc.), Case 32-

CE-52 (1989).

'SUCA contends that, under state law, Kaiser cannot lawfully

employ employees to perform work on this site. However, the state

agency, MWRA, has decided that the Employer ean do so, and the

Employer intends to do so. In these circumstances, we do not con-

sider it within our province to rule on the state law question.

&8a

ing involved the MWRA, not the Employer. Moreover,

none of the described activity was engaged in for the

purpose of forcing the Employer or any other employer

to enter into a “hot cargo” contract.

With respect to the surveyors, UCA asserts that the

Employer’s surveyors will not be covered by the Agree-

ment. However, the fact is that they will be covered.

The UCA’s mistaken belief apparently stems from the

fact that the Employer’s professional engineers, who use

surveyor equipment, are not covered by the Agreement.

It does not appear that the “union-signatory” require-

ment extends to subcontractors wheo employ professional

engineers.

Based on the above, we conclude that the instant charge

should be dismissed, absent withdrawal.

H.J.D.

ROF-3

y :Kaiser lfa

89a

APPENDIX E

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF KENTUCKY .

LEXINGTON

Civil Action No. 87-38

ASSOCIATED BUILDERS AND CONTRACTORS OF

KENTUCKIANA, INC. and RIVER CITY

DEVELOPMENT CORPORATION,

Plaintiffs

OHBAYASHI CORPORATION, et al.,

Defendants

ORDER

[Filed October 26, 1987]

This is an action in which the plaintiffs request that

this Court avoid a Project Agreement between Ohbayashi

Corporation and defendant labor unions. The grounds for

avoidance are that the agreement is against public policy

in the Commonwealth of Kentucky (Count I), that it

interferes with the plaintiffs’ reasonable future contrac-

tual relationships (Count II), and that, under color of

state law, it deprives the plaintiffs of property rights

in violation of the due process and equal protection rights

guaranteed by the United States Constitution (Count

ITT).

The complaint was originally filed in the Circuit Court

of Scott County, Kentucky, and was later removed to this

Court under 28 U.S.C. 1441 and 28 U.S.C. 1337. The

action is currently before the Court on the motion to

dismiss of Ohbayashi Corporation and of the defendant

unions,

90a

The factual background of this action involves the

Commonwealth’s inducement of Toyota Corporation to

locate a major automobile assembly plant near George-

town, Kentucky. The incentives proffered by Governor

Martha Layne Collins’ administration were approved

by the Kentucky General Assembly in Senate Joint Reso-

lution No. 7 signed by Governor Collins on February 24,

1986. In February, 1986, the Commonwealth and Toyota

also signed an agreement formalizing their mutual com-

mitments. This Toyota Agreement and the preamble to

Senate Joint Resolution No. 7 contained general state-

ments concerning the benefits to be derived by the citi-

zens of Kentucky.

At about the same time that the state announced the

advent of the Toyota plant in Kentucky, in December,

1985, Toyota announced that Ohbayashi Corporation

would be the genera] manager of the plant construction

in Seott County. Ohbayashi initially solicited bids on a

merit shop basis, from both union and merit shop com-

panies. River City Development Corporation bid success-

fully and obtained a contract as a subcontractor under

Daniel Construction Company, a general contractor on

the project.

Later, Ohbayashi entered into a Construction Project

Agreement with the defendant unions which became ef-

fective on December 1, 1986. The Project Agreement

recognized the defendant unions as the sole, exclusive

bargaining agent for craft employees working on the

project. (Article IV, Sec. 1.) It also mandated that all

employees, with certain exceptions, should be _ hired

through referral facilities maintained by the unions. /d.,

Sec. 2. Additionally, “Qualified residents of the Com-

monwealth of Kentucky shall be preferred for employ-

ment without discrimination based upon membership of

non-membership in a labor organization or upon race,

color, creed, sex, or national origin.” Jd. at Sec. 2.B.

The Project Agreement also included a grievance and

arbitration mechanism and no strike/no lock-out pro-

visions.

9la

The Project Agreement affected only those contracts

signed on or after December 1, 1986. Ohbayashi retained

the right tc choose any contractor whether or not the con-

tractor was unionized. Any successful bidder, however,

was obligated to sign the Project Agreement.

The plaintiffs allege that the hiring provision prevents

them from following their normal business procedure.

River City, a merit shop contractor, claims that since it

cannot determine its own work force, it has been pre-

vented from bidding to obtain further contracts on the

Toyota project and would be unable to take advantage of

the competitive edge it hoped to have established through

its initial successful bid.

The defendants argue that this action should be dis-

missed on various grounds. First, they contend that the

Project Agreement is consistent with state public policy

and furthermore is preempted by federal labor law. Spe-

cifically, pre-hire agreements and hiring halls are sanc-

tioned under Section 8(f), National Labor Relations Act,

29 U.S.C. § 158(f). Also, there was no tortious inter-

ference with the plaintiffs’ reasonable expectations in that

the plaintiffs’ had only a unilateral hope of future con-

tracts: River City’s own inhibitions, and not anything

in the Project Agreement, prevent its bidding on addi-

tional contracts; and the supposed interference not only

was not improper but is sanctioned by federal labor law.

Moreover, it is argued that there is no constitutional

deprivation in that the Project Agreement involved no

state action or protected property interest and is subject

to only rational basis review.

Initially, the Court observes that the plaintiffs have

apparently conceded the invalidity of their state policy

argument as set forth in Count I of their complaint. The

plaintiffs did not address this issue in their response to

the defendants’ motions to dismiss nor in their oral argu-

ments before the Court. The defendants’ arguments that

there is no conflict between public policy as expressed in

G9.

. ] y gi ] ‘ .

Joint Senate Resolution No. 7 and the Toyota Agreement

and the Construction Proje Agreement appears well

4 . + + . . ; " , +) 1}

ike! AS Was poln 1 out In Oral arguments, tne num-

» ' , , : ry ’ } } > »)" _ ? ‘ s 7 .

er of merit shop contractors and the percentage of Ken-

icKlans empiloved on the project Nave both increased

Since tne Pr ect Agreement went into effect

The plaintiffs also did not defend their state tort claim

either their response memorandum to the motions to

smiss or in oral arguments—beyond arguing in the

rmer that federal law does not preempt this clain

As the Court of Appeals of Kentucky observed in Culle

Southeast Coal Co., 685 S.W.2d 187, 190 (Ky. Ct. App

1978), the key to a description of tortious interference

th a prospective contractual] relation is “Improper in-

terference.” This means that the interference must be

accomplished by “fraud, deceit, or coercion,” Henkin, I

Bank & Trust Co., 566 S.W.2d 420, 425 (Ky. Ap;

197 , r by malice. Cullen. 685 S.W 2d at 190 Nothing

he plaintiffs’ pleadings, memoranda, or oral argu-

ments indicates that the Project Agreement involved

such egregious nduct that would rise to the level of

Daniel Construction’s “Request for Quotation,” dated pep-

tember 11, 1986, which was submitted by the plaintiff in

their Supplement to the Record, indicates that work was

0 be done on “a Merit Shop Operations basis.” River

City’s relation to Daniel has apparently remained un-

disturbed by tnis Project Avreement except thal change

orders have increased River City’s share of work on the

project. Associated Builders and Contractors (ABC

never has had a contract on the project and indeed 1s the

type of organization that does not bid on construction

projects.

The plaintiffs have not directed our attention to any

authority that would prevent Ohbayashi from changing

93a

the grounds on which construction bids are to be solicited.

(7 AGC (Jitter Ta } Powe r Company, 611 F.2d 684

Sth Cir. 1979): NLRB v. Local 103, lron Workers, 434

U.S. 335 (1978). The plaintiffs had no right to expect

a continuation of the initial bidding procedures and hir-

ing process Ir deed, the plaintiffs, as astute businessmen,

should have anticipated that unions would try to attempt

exert as much influence as possible on such a large

The Plaintiffs not only did not have a legitimate ex-

pectation that the whole project would remain on a tradi-

nal merit shop basis, but the Project Agreement does

not interfere with River City’s continuing right to bid

nm contracts. The Project Agreement specifically gives

Ohbayashi “the absolute right to select any qualified

bidder for the award of contracts on this Project without

reference to the existence or non-existence of any agree-

ments between such bidder and any party to this Agree-

ment " (Article II, See. 4.) Construction workers

ire to be considered for employment regardless of whether

r not they have a union affiliation. Thus even after the

Project Agreement went into operation, the basis for par-

ticipation in the Toyota project remained closer to a merit

hop basis than any other typical description. The main

acle to River City’s obtaining further work on the

‘] yola project seems to be its own reluctance to present

tself as “willing ready and able to comply with this Proj

’

e Avreemen hould it be designated the successful

furthermore, no relief can be given on the plaintiffs’

omplaint. In their complaint as filed, the plaintiffs have

only prayed that the contract be avoided. As of August

31, 1986, however, the project Was RO complete Avoid-

ing the contract would thus be meaningless. Amending

the complaint to request monetary damages would offer

no relief. River City has bid on no contracts since the

advent of the Project Agreement. Thus monetary dam-

94a

ild he Loo speculative Lo calculate. ABC would,

aves WOUlf

f urse,. not he entitled to monetary damages because

A Bt s not a contractor

The plaintiffs’ constitutional claim (‘Count III) is also

ibject to dismissal. In order to assert a denial of due

“ess or equal protection, the plaintiffs’ must establish

at this denial was under color of state law. The state

action must manifest itself as an integral aspect of the

rotested against action. Rendell-Baker v. Kohn, 457

U.S. &30 (1982): Graham NCAA, 804 F. 2d 953 (6th

The Commonwealth of Kentucky was very much in-

lved in inducing Toyota to construct an automotive

assembly plant in Scott County, Kentucky. As part of

inducement the legislature pledged to enact measures

help “develop, staff, fund, support and maintain the

program and incentives pledged to the Toyota Motor Cor-

poration in return for its commitment to the economi

development of the Commonwealth.” (Senate Joint Res-

n Ni This state assistance included the acqui-

nm of real estate, site improvements, highway im-

provements, employee recruitment and training, educa-

ional programs, and technical research. /d. The Agree-

ment between Toyota and the Commonwealth further

elaborated upon the precise extent and nature of this

ate involvement. The fact is there are few references

in this agreement to labor relations and conditions for

bidding on the project. The Agreement does say that it

the public policy of the state to provide employment

pportunities for its residents and citizens. The state

agreed to purchase a “Project Site” and to fund “Project

Improvements.” These “Project Improvements” involved

yeneral site preparations such as surveys, excavation,

cemetery removal, ete., which were to be undertaken

before the “Project Site” was conveyed in fee simple to

Toyota. In regard to the “Project Improvements,” the

Commonwealth was “to cooperate with and assist Toyota

95a

and Ohbayashi in connection with bidding procedures”

and to “monitor construction and installation of the

Project Improvements.”

Toyota itself was to “construct, install and complete

the Induced Facility at an estimated cost of approxi-

mately $800,000,000.” The Project Agreement to which

the plaintiffs object is between Ahbayashi and the Build-

ing and Construction Trades Department, AFL-CIO on

behalf of its affiliated unions and their loca] unions. The

Project Agreement applies to contractors on the “Induced

Facility” and not on the “Project Improvements.” It

evinces no state involvement at all.

The Sixth Circuit Court of Appeals held in Graham v.

Natwnal Collegiate Athletic Ass’n, 804 F.2d 953, 958

LYS6

ly |arlier cases were premised on the theory that in-

direct involvement by state governments could make

conduct normally considered to be private action into

state action. The Supreme Court rejected that the-

ry, however, in Rendell-Baker Lv, Kohn, 457 U.S.

991 (1982)| and Blum |v. Yaretsky, 457 U.S. 991

1982) }. As the Fourth Circuit recognized in Ar-

losoroff v. NCAA, 746 F.2d 1019 (4th Cir. 1984), in

order to conclude that the | defendants’ | conduct is

fairly attributable to the state it must be established

either that (1) the |defendants were! serving a

function which was traditionally and exclusively the

tate’s prerogative, or (2) the state or its agencies

caused, controlled or directed the | defendants’ |

action

The establishment of bidding procedures and labor con-

ditions for private construction projects is not tradi-

tionally a state function. And, although the state induced

Lhe Toyota project and envisions public benefits from

it, the plaintiffs have indicated no state involvement in

} > ‘ 4 ‘ ; . ‘ — »

he Prove Agreeme! either in its inception o1

1) The Motion to Dismiss of defendant Ohbay:

and of defendant Unions is GRANTED;

2; Defendant Ohbayashi Corporation’s Motion for

Clarification of the Court’s Order Granting Plaintiffs’

Motion for Leave to Supplement the Record or, in the

Alternative, Defendant’s Motion to Strike is DENIED

2; The Defendant Unions’ Motion to Strike in Part

is DENIED

1; This action is STRICKEN from the docket

s/ Henry R. Wilhoit, Jr

HENRY R. WILHOIT, JR

Judge

LESLIE G. WHIMER

Clerk

By Illegible

wer

Jia

APPENDIX F

Vol. 13, | 23061

MORRISON-KNUDSEN CO... INC.

NLRB Advice Memorandum

Case Nos. 26-CE-8, 26-CE-9, 26-CE-10, 26-CE-11,

26-CE-12, 26-CA-11428, 26-CA-11429

March 27, 1986

Index Nos. 584-1225-2500, 584-1225-6700. 584-3740-1700,

584-5000, 584-5014, 584-5028, 584-5042. 590-2500. 590-

2550. 590-2500-5000

These cases were submitted for advice as to whether a

greement is valid under Section &8(f) of the Act

prehire a

and whether certain clauses thereof are privileged by the

construction industry proviso to Section &(e

FACTS

In the fall of 1985,' Morrison-Knudsen Company, Inc.,

tne Kmployer ) was selected by The Saturn Corporation

(Saturn) to be the construction manager for the con-

struction of an automobile manufacturing facility in

Spring Hill, Tennessee. The Employer then met with rep-

resentatives of the Building and Construction Trades De-

partment of the AFL-CIO as well as International and

Local Unions (the Unions) to negotiate a project agree-

ment for the site. On October 8, the Employer met with

interested local contractors in Tennessee to dismuss the

bidding process at the Saturn facility. The Employer told

the contractors that, as construction manager, it would

not be doing any job site work; rather, all the construc-

tion work was going to be contracted out. The Employer

indicated that it would be acting as the agent of Saturn

in administering construction activities at the site and

1 All dates are in 1985, unless otherwise noted.

98a

in subletting contracts, and that any employees it hired

would be administrative, engineering, clerical, and

guards. In addition, the Employer told the contractors

present that there would be a project agreement covering

work at the site. The execution contractors (contractors

awarded a bid) would be required to sign this agreement.

On October 16, the Employer wrote to the contractors,

soliciting further information for the purpose of evaluat-

ing and “prequalifying” bidders for various phases of the

project. Once again, the letter informed the contractors

that the Spring Hill facility would be constructed under

a project agreement and noted that “[{i]f awarded a con-

tract, you will be required to become signatory to this

labor agreement,” but that “this agreement does not ex-

clude open or merit shop contractors from participating

in this project.”

On November 1 the Employer executed a project agree-

ment (the Project Agreement) with the Unions. The

Project Agreement applies only to construction work at

the Spring Hill, Tennessee, site and binds all execution

contractors to its terms. In addition, each execution con-

tractor agrees to recognize the Unions as the sole and

exclusive bargaining representatives for all craft employ-

ees on the project.

At the time the Project Agreement was executed, the

Employer had hired no employees. However, it now ap-

pears that the Employer’s present plans are to hire two

carpenters for work on the jobsite, and it intends to hire

more craft employees to perform a major portion of the

excavation work on the job site.* The Employer contends

that, based on past experience, it always expected that it

would have to hire craft employees at some point during

the construction project due to one or more of the follow-

ing circumstances: a default by a subcontractor, an un-

satisfactory or incomplete performance by a subcontrac-

tor, the receipt of uneconomical bids demonstrating that

2 (Ed. Note: Footnote omitted by Div. of Advice.]

the Employer itself could perform the work more cheaply,

minor jobs not worth bidding, clean-up work, and the

avoidance of jurisdictional disputes. Indeed, the Project

Agreement does not preclude the Employer from acting

as an execution contractor. Thus, Section 5, which spe-

cifically excludes certain areas from the scope of the

Agreement, excludes “|a]ll employees of the Construction

Manager not performing manual labor,” but does not ex-

clude other construction employees of the Employer.

ACTION

It was concluded that the instant charges should be dis-

missed, absent withdrawal.

The Charging Party first argues that the Project

Agreement is not a valid Section 8(f) agreement because

the Employer will not employ craft employees at the

Spring Hill job site. However, as noted above, the Em-

ployer has hired two carpenters at the jobsite and intends

to hire more employees pursuant to its decision to become

an execution contractor for excavation work at the site.

These employees will be doing construction work and will

be covered by the Project Agreement. The very nature of

a Section 8(f) agreement means that the employer in-

tends to hire craft employees to work on the job site at

some time during project construction. In this regard, we

would distinguish Squillacote v. Racine Trades Council,

483 F. Supp. 1218 (E.D. Wisconsin 1980), which indi-

cated that a prehire agreement would be unlawful if the

signatory employer (a general contractor) intended to

hire only noncraft employees. The court noted in Racine

Tades Council that the signatory’s employees were not

“employees whom |the unions] might represent in the

future,” 483 F. Supp. at 1222. Consequently, it could not

be argued that the unions in that case had a representa-

tional interest in seeking a prehire agreement with the

general contractor. By contrast, the Employer in the in-

stant case does plan to hire employees whom the Unions

traditionally represent and will represent.

100a

The Charging Party also argues that the agreement is

not valid under Section 8(f) because, it argues, the Em-

ployer is not engaged primarily in the construction indus-

try. Board law makes it clear that if an employer's

overall operations include a substantial amount of rey-

enue from construction work, then the employer is “an

employer engaged primarily in the building and construc-

tion industry” and is therefore qualified to enter into a

Section 8(f) agreement. Painters Local 1247 (Indiv

Paint and Rug Center), 156 NLRB 951. 960 (1966).

Moreover, even if an employer is not generally engaged

in the construction industry, it can nonetheless fall

within Section 8(f)} if it is engaged in construction work

at a particular project. Teamsters Local 83 (Stanley J.

Matuszak, NLRB 328, 331 (1979); Zidell Explorations,

Inc., 175 NLRB 887, 888-889 (1969). We have concluded

that the Employer in the instant cases meets these stand-

ards. Not only is the Employer recognized nationally as

major construction company, but with respect to the Sat-

urn site the Employer will take an active role in the con-

struction process. As construction manager, the Em-

ployer will oversee the general construction of the project,

select or effectively recommend the selection of execution

contractors, and perform construction work with its own

craft employees. Accordingly, the Employer is an em-

ployer engaged primarily in the building and construction

industry at the Saturn facility. It follows that Section

8(f) protects the agreement from illegality under Section

8(a) (2).

Finally, the Charging Party argues that the union

signatory clause of the project agreement is not protected

by the construction industry proviso to Section 8(e) be-

cause the Employer in the instant case is not “an em-

ployer in the construction industry,” and the Project

Agreement was not entered into within the context of a

collective bargaining relationship. As to the former con-

tention, the Charging Party argues that the Employer is

not the real party of interest to the Project Agreement,

10la

but that it executed that Agreement only as an agent of

Saturn. Concededly, it appears that Saturn made the de-

cision that the Spring Hill facility would be constructed

pursuant to a project agreement and Saturn has the final

authority as to which contractors will actually be

awarded the project bids. However, the essential point is

that the Employer, and not Saturn, is the signatory to

the project agreement. The fact that the Employer may

have entered into the agreement at the direction of Sat-

urn does not alter the fact that the Employer is the sig-

natory.

The Charging Party also argues that, even if the Em-

ployer is the actual signatory (which we believe it to be),

there is no proviso protection because the Employer is not

engaged in the construction industry. In our view, as dis-

cussed below, the Employer’s role in regulating the labor

relations at the job site is more than sufficient to invoke

the protection of the construction industry proviso. The

Employer is a major general constractor with construc-

tion contracts throughout the United States. Where, as

here, an employer’s principal business is in the construc-

tion industry, no further analysis is necessary in order

to deem it to be “an employer in the construction indus-

try” for purposes of Section 8(e). See United Brother-

hood of Carpenters and Joiners of America (Longs Drug

Stores, Inc.), 278 NLRB No. 62, ALJD at 7-8 (1986).

Under that test, the Employer is clearly engaged in the

construction industry. Further, even if an employer’s

principal business is not in the construction industry, but

it acts as its own general contractor on a specific con-

struction project, the Board may nontheless find proviso

protection, depending upon “the degree of control over the

construction site labor relations it [the general con-

tractor] elects to retain.” Curpenters (Longs Drug

Stores, Inc.), supra, ALJD at 8. See also Los Angeles

Building and Construction Trades Council (Church’s

Fried Chicken), 183 NLRB 1032 (1970). Even under

this analysis, the Employer herein has retained sufficient

102a

control over labor relations at the job site to qualify for

the Section 8(e) proviso. Thus, in the instant case, while

it appears that Saturn ultimately determines who will be

awarded the contracts at the site, the Employer is re-

sponsible for soliciting all bids and making recommenda-

tions to Saturn concerning who should be awarded those

bids. In addition, the Employer is the signatory to the

subcontracts with the execution contractors. It is ulti-

mately responsible for the administration of the Project

Agreement and for the performance of all its execution

contractors on the job site. Under these circumstances,

the Employer is clearly “an employer in the construction

industry.”

As to the contention that the agreement is not in the

context of a collective bargaining relationship, we note

that the construction industry proviso to Section 8/e)

authorizes the negotiation of union signatory clauses by a

union and construction industry employer in the context

of a collective bargaining relationship. Cornell Construc-

tion Co. v. Plumbers Local 100, 421 U.S. 616, 633 (1975),

A Section 8(f) prehire agreement voluntarily entered

into satisfies this requirement. Los Angeles Bldg. and

Const. Trades Council (Donald Shriver, Inc.), 239 NLRB

264, 267-69 (1978), enf’d 635 F.2d 859, 872-876 (D.C.

Cir. 1980), cert. denied 451 U.S. 976 (1981). See also

A.L. Adams Construction Co. v. Georgia Power Co., 557

F. Supp. 168, 174-177 (1983); aff’d 733 F.2d 853, 856-

858 (llth Cir. 1984), cert. denied 105 S. Ct. 2155

(1985). In the instant cases, we note that the Employer

intends to hire construction employees, and intends to

cover them with a collective bargaining agreement. Thus,

the requirement of a collective bargaining relationship is

satisfied.

Accordingly, the instant charges should be dismissed,

absent withdrawal.

by Harold J. Datz,

Associate General Counsel

Division of Advice

103a

APPENDIX G

NATIONAL LABOR RELATIONS BOARD

REGION 27

260 New Custom House, 721 Nineteenth Street

Denver, Colorado 80202

(303) 837-3551

April 16, 1982

Mr. Neil O. Andrus, Attorney

Musick, Peeler & Garrett

718 Seventeenth Street, Suit 1500

Denver, Colorado 80202

Re: International Union of Operating Engineers, Local 3

Case No. 27-CE-27, Utah Building & Construction

Trades Council, et al. Case No. 27-CE-28

Dear Mr. Andrus:

The above-captioned cases, charging violations under Sec-

tion 8 of the National Labor Relations Act, as amended,

have been carefully investigated and considered.

As a result of the investigations, it does not appear that

further proceedings are warranted. The primary issues

presented in the above-referenced cases are whether Des-

eret Generation and Transmission Cooperative is an em-

ployer in the construction industry and whether Forrest

Concrete Pumping’s work performed is done at the site of

construction. The investigation reveals that Deseret is a

non-profit corporation formed for the purpose of con-

structing and operating a coal-fired electricity generation

plant located near Bonanza, Utah. The project is called

the Moon Lake Project. Deseret has solicited bids and

entered into over eighty prime contracts for the con-

struction of the power plant. On the job site, Deseret

employs three individuals: Bolen, the construction engi-

104a

neery and construction department manager; Doyle, the

civil engineer; and Cain, the loss control supervisor.

Bolen’s responsibilities include the coordination of all ef-

forts of the prime contractors, as well as overseeing the

construction of the power plant in conjunction with a

consulting engineering firm.

On or about February 3, 1981, Deseret and its agent,

Jeleo Division of Townsend and Botlum, Inc., negotiated

and entered into a project collective bargaining agree-

nent, which was signed by approximately thirty unions.

The project agreement contains, among other things, a

provision which requires contractors and subcontractors,

as they bid and are accepted for future work, to sign a

letter of assent. The letter of assent requires them to

recognize the appropriate construction union as the sole

and exclusive bargaining representative of the project

contractors’ and subcontractors’ employees and adhere to

substantially all the terms of the applicable master con-

struction agreement.

The Moon Lake Project construction site consists of

approximately 2,000 acres. Due to the great quantities

of concrete required in the construction of the power

plant, its distance from any large population centers, and

the very size of the site, a concrete batch plant was

erected on the project itself. Construction is occurring

throughout the entire work site, and the concrete batch

plant is centrally located on that site.

On or about July 1, 1981, Deseret awarded Centric the

work of erecting all substructures and foundations on the

Moon Lake Project. On the same date, Centric signed

the letter of assent. In performance of its work, Centric

utilizes concrete which is prepared at the on-site concrete

batch plant. That concrete batch plant is operated by

Acme Readymix. When Centric is ready for concrete to

be poured, it contacts Acme’s on-site batch plant and ar-

ranges for a certain quantity of concrete to be delivered

105a 3

to the point of the pour. The concrete is delivered by

Acme’s concrete trucks.

Forrest Concrete Pumping is a corporation engaged in

the business of pumping readymix concrete from concrete

delivery trucks to concrete forms on construction projects.

Forrest has performed concrete pumping for various con-

struction contractors on the Moon Lake Project, including

the performance of services for Centric. Forrest gets

concrete from Acme’s on-site batch plant and delivers it

to structures on the construction site. Forrest deals with

the contractors on a will-cal] basis and has no written

contract with Centric for its services, nor has Forrest

signed a letter of assent pursuant to the project collective

bargaining agreement.

In determining whether Deseret is an employer within

the construction industry, I considered the fact that Des-

eret acts as its own general contractor, in that it solicits

and signs contracts with prime contractors and oversees

the construction of the Moon Lake Project through its

construction engineer. Therefore, Deseret, as a general

contractor, exercises control over the labor relations of

-he construction site and over the selection of contractors

and subcontractors. It is immaterial, that Deseret is not

doing any actual ecnstruction nor that its primary busi-

ness once the Moon Lake Project is completed will be the

operation of the power plant.

Accordingly, I have concluded that Deseret is an em-

ployer in the construction industry within the meaning

of the construction industry proviso of 8(e).

It is also concluded that Forrest’s delivery of concrete

from the concrete batch plant that is centrally located on

the construction site to various structures on the con-

struction site is work done at the site of construction.

The construction industry’s exemption from &(e) was

based on Congressional appreciation of the close commu-

nity of interest which exists among employees working on

+ a 7

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Inland (

W. BRUCE GILLIS, JR

W. Bruce Gillis. J:

Regional Director

Receipt Requested

‘ ple sent tf ed ni Wing page

International Union of Onerating Engineers, Local

1958 West North Temple, Salt Lake ¢ Ly, Utah

x4116

Forrest Concrete Pumping, Inc., 1630 Beck St., Salt

Lake (¢ ty Utah S4116

Centric ¢ Orporation, 5490 W 1st! Avenue enver,

Colorado

Deseret Generation and Transn t erative

$722 Smith 300 West, Sandy, Utal S407!

Utah Building & Construction Trades | im 2261

South Redwood Road, West Valley City Utah

International Association of Heat & Frost Insulators

and Asbestos Workers, Local No. 69,°2261 South

Redwood Road, West Valley City, Utah

nited Brotherhood of Carpenters and Joiners of

America, Local No. 184, 2261 South Redwood

Road, West Valley City, Utah

Brotherhood of Bollermakers. lron

| f na na

| Build ny Blacksmitl Forge and Helpers,

Lavaca LSZ 150 Kast 700 South, Salt Lake City,

Utah

nationa Brotherhood of I lectical Workers,

Local Ni 354 1164 South Main, Salt Lake City,

International Union of Bricklayers and Allied Crafts

men, Local Nos. 1, 2. and 6, 2261 South Redwood

~ cATING

Road, West Valley City, Utah

International Association of Bridge, Structural and

and Ornamental lron Workers, Local No. 27, 2261

South Redwood Road, West Valley City, Utah

Loca N 312, 2261 Sout! Re iwood Road, West

Vi ley Ltal

International Brotherhood of Painters and Allied

Trades. Local No. 77, 360 West 1600 South, Salt

Lake ( L'tal

Uy ed Associa I f J irnevme! and Apprentice

f the Plumbing and Pipefitting Indust: f the

Lnited States and Canada Loca Ni 7, 226)

South Redwood Road West Valley City, Utah

International Brotherhood of Teamsters, Chauffeu

Warehousemen and Helpers of America, Lo

222 2621 South 3270 West, We Valle Cit

l'tal

Building and Construction Trades Departme! AFT

CIO, AFL-CIO Building, 815 - 16th Street, N.W

W ast ngtor 1). 20006

internationa! Association of Heat & Frost Ir late

and A pests Wi rrer> AO5 Mas ninists B 1) dit {7

1300 Connecticut Avenue, N.W., Washington, D.t

vA, rf 136

United Brotherhood of Carpenters and Joiners of

America, 101 Constitution Avenue, N.W., Wasi

ington ID. 2000]

International Brotherhood of Boilermakers, Iron Ship

Suilders, Blacksmith, Forgers and Helpers, New

sgrotherhood Building, &th Stre it State Avenue

Kansas City, Kansas 6610]

International Brotherhood of Klectical Workers, 1125

15th Street, N.W., Washington, D.C, 20005

109a

International Union of Bricklayers and Allied Crafts-

men, 815 15th Street, N.W., 20005

International Association of Brudge, Structural and

Ornamental Iron Workers, 1740 New York Ave-

nue, N.W., Suite 400, Washington, D.C. 20006

Operative Plasters’ and Cement Masons’ Interna-

tional Association, 1125 17th St., N.W., Wash-

ington, D.C. 20036

Laborers’ International Union of North America, 905

16th Street, N.W., Washington, D.C. 20036

United Union of Roofers, Waterproofers and Allied

Workers, 1125 17th Street, N.W., Washington,

D.C. 20036

Sheetmetal Workers’ International Association, 1750

New York Avenue, N.W., Washington, D.C.

20036

International Brotherhood of Painters and Allied

Trades, 360 West 1600 South, Salt Lake City,

Utah

United Association of Journeymen and Apprentices

of the Plumbing and Pipe Fitting Industry of the

United States and Canada, 901 Massachusetts

Avenue, N.W., Washington, D.C. 20001

International Brotherhood of Teamsters, Chauffeurs,

Warehousemen and Helpers of America, 25 Lousi-

ana Avenue, N.W., Washington, D.C. 20001

Genera! Counsel National Labo Relations Board,

1717 Pennsylvania Avenue, N.W., Washington,

DC 20570

110a

APPENDIX H

UNITED STATES CONSTITUTION,

Art. VI, el. 2

T) Ol] tution. and the Laws of the United States

which shal] be made in Pursuance thereof; and all Trea-

es made, or which shall be made, under the Authority

f the United States, shall be the supreme Law of the

Land: and the Judges in every State shall be bound

here ny Thing in the Constitution or Laws of any

Stat he Contrary notwithstanding

29 USC § 152(2)

e term “employer” includes any person acting as

in agent of an employer, directly or indirectly, but

all not include the United States or any wholly owned

Government corporation, or any Federal Reserve Bank,

any State political subdivision thereof, or any per-

m subject to the Railway Labor Act [45 U.S.C.A. § 151

et seq.|, as amended from time to time, or any labor or-

n (other than when acting as an employer), or

me ne in the acity of officer or agent of suc!

al te I it Y

29 USC § 158(e)

It shall be an unfair labor practice for any labor o1

nization and any employer to enter into any contract

.vreement, 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

gaoing husiness with any other person, and any contract

or agreement entered into heretofore or hereafter co!

ning such an agreement shall be to such extent un-

enforcib'e and void: Provided, That nothing in this sub-

section shall apply to an agreement between a labor or-

llla

ganization and an employer in the construction industry

no te t} contracting or subcontracting of work to

be d it the site of the construction, alteration, paint

ing, or repair of a building, structure, or other work:

Provided further, That for the purposes of this subsee-

tion and subsectior b ! B) of this section the terms

an : ny person engaged in commerce or an

industry affecting commerce’, and “any person” when

d in relation to the terms “any other producer, proc-

essor, or manufacturer’, “any other employer”, or “any

other person” shall not include persons in the relation of

jobber, manufacturer, contractor, or subcontractor work-

ing on the goods or premises of the jobber or manufac-

ture) rr perIorming parts ot an integrated process of

roduction in the apparel and clothing industry Pro-

rther. That noth ng n this s ibchapte r shall pro-

hibit the enforcement of any agreement which is within

ne ft ‘ ’ Ke '

9 US Los (f

ha be al fair e unde ibsec-

f ti ACTION cay i! emi over en-

’ n the building and construction indus-

. ‘ } 4 el covering empliovees eng wed

who an thy emplovment. be engaged) in the

ny and construction industry with a labor oreaniza-

yl | bu cing i! constructior employees are

not estab ned, maintained. or assisted by any

} lefined } ibsect Ol a of thi ection aS an un-

bh . ray hye Ise ] he n ority status of

hy reanization h; not been established under

t hy 0) ’ of ection 159 of this title prior to the

, f ich reement. o7 , suct ivreement re

, , condition of employment, membership in such

DO) ryaniZatior ifter the eventh day following the

beginning of ch employment or the effective date of the

agvreement, whichever is later, or (3) such agreement re-

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