# Amicus Curiae Brief — Phelps Dodge Corp. v. AFL-CIO Joint Negotiating Committee > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385606_1484%3A3 ## Record - **Collection:** Supreme Court brief - **Document type:** Amicus Curiae Brief - **Published:** January 1, 1972 - **Citation:** 409 U.S. 1059 ## Text No. 72-220 PHELPS DODGE CORPORATION, rs. Petitioner, AFL-CIO JOINT NEGOTIATING COMMITTEE FOR PHELPS DODGE CORPORATION, er at, and THE NATIONAL LABOR RELATIONS BOARD, Respondents. No. 72-359 NATIONAL LABOR RELATIONS BOARD, rs. Petitioner, AFL-C1lO JOINT NEGOTIATING COMMITTEE FOR PHELPS DODGE, er a... axv PHELPS DODGE COR. PORATION, Respondents. BRIEF AMICUS CURIAE ON BEHALF OF THE CHAM. BER OF COMMERCE OF THE UNITED STATES OF AMERICA IN SUPPORT OF THE PETI- TIONS FOR WRIT OF CERTIORARI. MILTON A. SMITT, General (ooneert, TT F. WENZLER. Laber Relations Count, Chamber of Commerce of the Taited State« of America. 1615 H Street. XN. W.. Washington, Ip. C. 20008, GERARD CC. SMETANA, #25 Seuath Homan Arenue. Chicage, Milinei« 60607, LAWRENCE M. COHEN. HERBERT M. RERMAN. K. BROCE STWKLER, LEDERER, FOX AND GROVE. Itt Weet Warhincton Street. Chicage, Mlineixs quan, Afterneys for the Chamber of Commerce of the United States of America. , aye POLES PP! Aye HS Se seo 6 < SR Tyee ‘ INDEX. — PAGE Brief Amicus Curiae on Behalf of the Chamber of Commerce of the United States of America in Sup- port of the Petitions for Writ of Certiorari........ 1 Interest of the Amicus Curiae...................... 2 Ce GE BOE. 0 4. c cccccvesccssccesesscosess 3 AaMMMOM on ccccccccccccscccccccccccccocccsccccece 5 A. The decision below will lead to the breakdown of the stable bargaining units envisaged by es 6.66666 6656006058 560000655 008 SC SECO 5 B. The Court below has misconstrued the con- trolling decisions of this Court.............. 7 C. The decision below raises a substantial and recurring question in the administration of GD BR ccccccccevceccceccsecscecséseesene 9 PD | «75 le 666 cebeae ébaeeendieceneansueneetn 11 TasBLe or Cases. Allied Chemical Workers v. Pittsburgh Plate Glass Company, 404 U. S. 157 (1971)............ 3, 5, 7, 8,9, 11 American Federation of Musicians v. Carroll, 391 U.S. NIN sc cagducie ackanuueiele , Sea te a 7,8 American Ship Building Co. v. NLRB, 380 U. S. 300, See ED 00.6065060040606adeesebeobneboeseneses 4 Central Soya Company, Inc., 142 NLRB 930, 939..... 10 Douds v. I. L. A., 241 F. 2d 278, 282-283 (2nd Cir. 1957) 10 Fibreboard Paper Products Corp. v. NLRB, 379 U. S. International Longshoremen’s Association (New York Shipping Association, Inc., 118 NLRB 1841, 1843 (enf. den.) 277 F. 2d 681 (D. C. Cir. 1960).......... 10 Mastro Plasties Corp. v. NLRB, 350 U.S. 270 (1956).. 1 N. L. R. B. v. General Electric Co., 418 F. 2d 736, 760 i Tp sasnenédoenéeacbesrnsesdenensséetsens y N. L. R. B. v. Hess Oil & Chemical Corp. 415 F. 2d 440, 444 (1969) cert. den. 397 U. S. 916 (1970)...... 10 N. L. R. B. v. Insurance Agents’ International Union, 361 U. S. 477, 497-498 (1960) ...............22000.. 4 N. L. R. B. v. Montgomery Ward & Co., Inc., 399 F. 2d I, CE cocdcdeceseveeisosonscors 10 Shell Oil Co., 194 NLRB No. 166 (1970)............. 6 The Standard Oil Co., 137 NLRB 690, 691 (1962)..... 10 Teamster’s Union v. Oliver, 358 U. S. 283 (1959)..... 7,8 Textile, Inc., 119 NLRB 1792, 1797-1798.............. 10 United Mine Workers v. Pennington, 381 U. S. 657, DPT + .scdatkbitenssvndbeneavenneennedoason 10 William M. Cherresh, Coalition Bargaining (Univer- sity of Pennsylvania Press 1969).................. 3 MISCELLANEOUS. William M. Chernesh, Coalition Bargaining (Univer- sity of Pennsylvania Press 1969).................. 3 G. Hildebrand, Bargaining Structures and Relative Power, Report No. 5, Collective Bargaining: Sur- viving in the 70’s (Industrial Research Unit, Whar- ton School of Finance & Commerce, University of PED Gees Ob Bc ccccccscasccocsccccecs 4 1967 Labor Relations Yearbook, 84, 85, 91............ 7 I Be a ee ae ee IN THE Supreme Court of the Gnited States Octoser Term, 1972. No. 72-220. PHELPS DODGE CORPORATION, Petitioner, vs. AFL-CIO JOINT NEGOTIATING COMMITTEE FOR PHELPS DODGE CORPORATION, er ax. and THE NATIONAL LABOR RELATIONS BOARD, Respondents. No. 72-359. NATIONAL LABOR RELATIONS BOARD, Petitioner, vs. AFL-CIO JOINT NEGOTIATING COMMITTEE FOR PHELPS DODGE, er av., ax» PHELPS DODGE COR- PORATION, Respondents. BRIEF AMICUS CURIAE ON BEHALF OF THE CHAM. BER OF COMMERCE OF THE UNITED STATES OF AMERICA IN SUPPORT OF THE PETI. TION FOR WRIT OF CERTIORARI. ooo eee INTEREST OF THE AMICUS CURIAE. The Chamber of Commerce of the United States of America (hereafter ‘‘the Chamber’’) files this brief amicus curiae to present its views on a case of great significance in the administration of the National Labor Relations Act.’ Respondent Committee represented to the Board that this is ‘‘one of the most important cases—if not the most im- portant case—to come before the Board in many years.’” The Chamber agrees and, for this reason, submits that this Court should review the instant case. The issue presented here—whether the Board may con- clude that an attempt to obtain agreement on terms and conditions of employment to be generally applicable on a company-wide basis constitutes an impermissible effort to extend the bargaining unit—is of substantial interest to the Chamber.* Many of its members deal with unions which represent, as the Committee did here, employees in two or more bargaining units. This case, as the court of appeals modified opinion made clear,‘ is not limited to the particular 1. This brief is filed with the w ritten sonnent of all parties in accordance with Rule 42(2) of this Court. 2. See the Committee’s Brief in support of exceptions to the Board Trial Examiner's Decision, p. 1. 3. The Chamber is a business federation with a membership of more than 3800 state and local chambers of commerce and trade associations. It has an underlying membership cf more than five million businessmen and business firms. many of which are en- gaged in commerce and subject to the Act. 4. In its initial decision, the court did not pass on the question of whether bargaining to impasse on mandatory subjects could be considered evidence of an unlawful objective te expand the bar- gaining unit. In the court’s modified order. however, the court expressly assumed that the Committee's de inands were all manda- tory items and concluded nevertheless that insistence to impasse upon them was ‘‘not evidence of an attempt to merge the bargain- TPS LETS BL NT SRI NO IIE ST ee 3 factual situation here involved; it would substantially alter existing bargaining relationships in each of these other situations as well. As the Board observed in its petition for certiorari (p. 8), the decision would permit unions in numerous industries to unilaterally enlarge bargaining out- side the confines of established bargaining units.’ This is a matter of vital concern to the Chamber and its member organizations. For example, the Chamber recently appeared as an amicus curiae in Allied Chemical Workers v. Pitts- burg Plate Glass Company, 404 U. S. 157 (1971), where it successfully requested this Court to confine mandatory bar- gaining to the active employees in an appropriate unit. The Chamber has a similar interest in this case and re- spectfully requests this Court to consider its views. SUMMARY OF ARGUMENT. This case presents the Court with board issues of far- reaching legal and economic significance. First, despite the national controversy generated by the issue of coalition or coordinated bargaining this Court has never had an opportunity to pass on the question. Because of increased union efforts to expand bargaining units, de- termination by this Court of the questions presented in this ing of separate units.’’ App., p. A. 13. Thus, the court not only decided that the Board’s decision was not supported by substan- tial evidence, but was wrong on a material question of law, i.e.. whether an improper bargaining object could ever be determined where a union does not use improper bargaining means. 5. In addition to the enlarged unit bargaining in the non- ferrous metals industries, as shown here, there is a strong likeli- hood of such bargaining in other major industries, where, as here, there is uniform bargaining by a small number of employers. Ex- amples of such industries are the home products. chemical and oil industries. See William M. Chernesh, Coalition Bargaining (University of Pennsylvania Press 1969). —_ Ps ee ene rere - % Pe vstrcemcnn., fobs A 4 case is imperative. It is apparent, as hereafter noted at pp. 3-5, that the union approach here involved, in view of its approval by the court below, is now being frequently emulated by other powerful unions in major industries, This Court should determine the lawfulness of this new and destructive bargaining tactic. Second, the decision below alters, without legislative ap- proval, the economic balance of power between employers and unions. As one commentator has suggested, the goal of coalition and related forms of inter-unit bargaining **. . . is to bring about unilaterally an enlargement of the scope of negotiations and of decision-making to embrace a fragmented group of bargaining units that had hitherto negotiated separately." We submit that only Congress, not the courts, ean determine whether such a goal is ap- propriate. As this Court noted in American Ship Building Co., v. NLRB, 380 U.S. 300, 317 (1965), citing NV. L. R. B. y, Insurance Agents’ International Union, 361 U.S. 477, 497- 498 (1960), the Board cannot **... introduce some standard of properly ‘balanced’ bargaining power, or some new dis- tinction of justifiable and unjustifiable, proper and ‘abusive’ economic weapons into ... the Act.’’ Economic and social judgments must remain within the discretion of the legis- lature; they are not within the province of courts or ad- ministrative agencies. Third, the Court below by naively and myopically viewing the Committee’s demands sanctioned unilateral enlarge- ment of the bargaining units. The effect was to judicially amend the Act, and disregard the Board’s expertise in 6. Hildebrand, Bargaining Structures and Relative Power, Re- port No. 5, Collective Bargaining: Survival in the 70's (Tndustrial Research Unit, Wharton School of Finance & Commerce, Univer- sity of Pennsylvania 1972). p. 10. 5 determining the unit in which bargaining is to take place. Moreover, in so doing, the Court below misapplied deci- sions of this Court, and acted in derogation of the recent decision of this Court in Pittsburgh Plate Glass. ARGUMENT. A. The Decision Below Will Lead to the Breakdown of the Stable Bargaining Units Envisaged by the Act. The approval by the Court below of a union charade to engage in enlarged unit bargaining will lead to a breakdown of collective bargaining in numerous multi- unit companies. No longer will employers be required to bargain only within the confines of stable units established in accordance with the Act; rather, simply by following the blueprint drafted by the court below—making mandatory demands which have the intent and effect of enlarging an established unit—a union can extend negotiations to new units without the voluntary employee choice contemplated by our national labor policy. Instead of stabilizing bargain- ing, this technique will inexorably lead to a severe dis- location of free collective bargaining in contravention of. the intent of the Act. Indeed, a few recent examples clearly illustrate the rapidly increasing utilization of extra unit bargaining with its concommittant reigniting of long and often painfully resolved disputes regarding the appropriate bargaining unit. Item 1: In negotiations this year between Armstrong Cork Company and a coalition of unions under the leader- ship of the Industrial Union Department of the AFL-CIO, the unions at numerous locations made bargaining demands, 6 such as a limited no strike clause, a common company- wide termination date and a ‘‘most favored nations’’ clause, identical to those involved in the instant case. The basis for the unions’ demand was expressly stated to be the decision of the court below. The unions thus hoped to accomplish through this device the goal of **coordinated”’ negotiations, a goal which had already led to violence, strikes, lockouts and the disruption of a previously peace- ful relationship. See the affidavit of L. J. Bibri, attached hereto as Appendix A. ; Item 2: In another situation which closely parallels the ‘ instant case, a coalition composed of the International 3 Brotherhood of Electrical Workers and four of its local affiliates sought to merge all units represented by any mem- : ber of the coalition in the General Telephone Company of the Southeast into a single unit.’ As in the instant case, this coalition has demanded, as the condition precedent to the conclusion of any contract, a common expiration of all contracts. : Item 3: In another variant of the instant theme, during ' recent negotiations between Shell Oil Company and the Oil, Chemical and Atomic Workers International Union, a union tried to force a unilateral merger of separately certified bargaining units for the purpose of negotiating uniform fringe benefits. In Shell Oil Co., 194 NLRB No. 166 (1970), i the Board found, relying on its decision here (now set : aside by the court below), that the company’s refusal to i engage in such enlarged unit bargaining did not violate the Act. The union has now appealed that decision on the basis of the court of appeals opinion in the present case. A similar approach was utilized by the Industrial Union De- 7. See complaint ened by the Director of “Region 11 of the Board in Case No. 5-CB-1279, attached hereto as Appendix B. BPirdeas nernicinnimec ove piste data dk adie atom 7 - —__- partment of the AFL-CIO in 1966 negotiations with Union Carbide Corporation; the I. U. D.’s goal there also, was ‘‘to force companies to negotiate major economic items on a national level.’’ The result was strikes at eleven Union Car- bide plants, which ranged from 44 to 246 days, involved 7200 hourly paid employees, the loss of $20.5 million in wages and cost the company almost $3.5 million in pre- tax income. 1967 Lab. Rel. Yearbk. 84, 85, 91. As more and more unions in multi-unit companies learn the lesson taught by the court below, they also will seek to improperly enlarge their bargaining power by demand- ing enlarged unit bargaining. The cost will be industrial strife and economic dislocation. The Chamber submits, therefore, that the decision below is not only incorrect, but that it has severe, far-reaching economic consequences involving the very structure of the institution of collective bargaining. This Court should address itself to the legality of this serious national problem. B. The Court Below Has Misconstrued the Controlling Decisions of This Court. In reversing the Board, the Court below relied on four decisions of this Court.* Upon the basis of these cases, the Court sanctioned the enlarged-unit bargaining techniques of the Union on the ground that ‘‘the fact that a demand may have extra unit effects does not alter its status as a manda- tory subject of bargaining.’’ (App., p. A13.) In enunciating this rule, however, the Court below overlooked the fact that none of the cited decisions sanctioned unilateral enlarge- 8. Fibreboard Paper Products Corp. v. N. L. R. B.. 379 U.S. 203 (1964): American Federation of Musicians v. Carroll, 391 ULS.99 (1968); Teamster’s Union v. Oliver, 358 U.S. 283 (1959) : Allied Chemical Workers v. Pittsburgh Plate Gless Co., supra. ment of the unit such as occurred in this case. Fibreboard, Carroll and Oliver, all arising in a subcontracting or unit preservation context, do not require a company to bargain about demands which enlarge a unit, but only to bargain about demands which, while having coincidental ‘*extra-unit effects,’’ concern the preservation of unit work or unit jobs. Indeed, in Pittsburgh Plate Glass, this Court not only so limited Fibreboard and Oliver but indicated as well that **[o)ther considerations, such as the effect on the employer's freedom to conduct his bu~ine=+, may be equally important.” 404 U.S. at 179, n. 19 Cengeliast« added). In the instant case, the Committee did not seek to pre- serve unit work or jobs, but, rather, sought to enlarge the unit for its own bargaining advantage. Such an objective disregards the admonition of thix Court in Pittsburgh Plate Glass Co. that an employer's bargaining obligation extends only ‘‘to ‘terms and conditions of employment’ in the unit ‘appropriate to such purposes * which the union | represents,” % In Fibre board, the © ourt held tha “replacement of em. ployees in the existing bargaining unit with these of an independ. ent contractor te do the same work under similar conditions of employment—i iva paney subject of collective bargaining under Section 8(b).°° 379 UT. at 215. In Oliver and in Carroll, this Court dealt with the pada Se of whether certein combinations or agreements violated anti-trust laws. In Olirer, the Court found that a provision of a collective bargaining agreement regulating truck rental paid to independent truck drivers was a mandatory subject of bargaining and did net therefore vielate Ohio's anti- trust law. The Court said that **. . . an inadequate rental might mean the progressive curtailment of jobs through withdrawal 4 more and more carrier-owned vehicles from serviee.”” 358 U. 8 at 295. Similarly, in Carroll, this Court held that a labor agree. ment provision requiring an orchestra leader to charge a minimum price does not violate the Sherman Act because “the price list . has the objective to protect employees” job opportunities and yr job competition of other union members . . °° 391 U.S. at 101-1 and not to extra-unit bargaining. The area of unit deter- nination is one which singularly involves Board exper- tise; its decisions are to be ‘‘accorded broad discretion.”’ The objective must be one of grouping together only em- ployees who have ‘‘substantial mutual interests"’ in order “to assure the coherence among employees necessary for dicient collective bargaining.”’ 404 U.S. at 171-172. The decision below, it ix submitted, disregards these principles. C. The Decision Below Raises a Substantial and Recurring Question in the Administration of the Act. Even assuming arguendo that the specific extra-unit de- mands of the Committee are mandatory bargaining sub- jects, such demands, when considered together with, and in the context of, the Committee's goal of company-wide bar- gaining, had the clear intent and effect of impermissibly enlarging the bargaining unit and of merging all of the Company's operations into a single unit. Ax the Court of Appeals for the Second Circuit pointed out in N. 1. R. B. v. General Electric Coa. AVS F. 2d 736, 760 n. 15 (1969), cert, den., 397 U.S. 965 (1970), in determining that an unployer’s overall conduct of negotiations wax unlawful even though hix individual actions considered alone were proper : ... A policy .. ., innocent in and of itself, can in context become a vital part of an illegal overall pattern of conduct. Similarly, in this case, the Committee’s demands, when considered im fofo, unilaterally enlarged the bargaining unit." The Committee's willingness to bargain separately at each location, as the Board recognized, was a sham. The items it demanded, if made part of a collective bargaining agreement, would necessarily have precluded separate unit negotiations, and would have effectively merged all of the Company's plants into a single overall unit. Before agreeing, for example, on a wage adjustment at any one plant in its operation, the Company would be constrained to consider its effect on all units; under the ‘‘most favored nation”’ clause, a more favorable wage adjustment would automatically be incorporated into a contract covering all other represented units. Similarly, if the proposed limited no strike clause were adopted, the Company could never make a decision to accept a strike at any one location with- out at the same time determining whether it could accept a strike at all of its other locations. To the same effect, the common ommon expiration date demand would, as a_ practical _-_--_—_- 10. “10. Inet enacting Section 9 of the Act. ‘Cangrem establiched a detailed precedure for collective bargaining. An established bar- gaining unit cannot be altered by unilateral action of one of the parties, but only throuch mutnal consent er through utilization of the Board's representation procedures. [»fcrnetional Lane. shoremen’s Association (New Vark Shipping Association, Ine). 118 NLRB 1841. 1842. enforcement denied on other ereunds, 27 F. 24 681 (D.C. Cir, 1960): N LB Rv. Mentqemery Ward & Co, Inc. 399 F. 2d 409, 112 (7th Cir, 1968): Dowds © TL A. 247 F.2d 278, 282-283 (2nd Cir, 1957); Central Some Company Tac... 142 NLRB 930, 939: Tertile. Jee. 119 NLRB 1792. 1797-17% Absent agreement. neither empleyer ner anien “may attempt te force on the other an enlargement or merger of an established ani or units.” Shell Oi Co., supra, Accord: NX. L. R. Bo v. Hess OF @ Chemical Corp. 415 FP. 2d 440, 444 61969). cert, denied 297 TS 916 (1970): The Standard Oi Company. 137 NLRB 690, &™ (1962) enforced 222 F. 24 40 (6th Cir, 196%). Indeed the anti- trust, as well as the laher, laws are “clearly st agrinst emplever- union agreements seeking to prescribe labor standards outsule the bargaining unit.” (nited Mine Workers «. Perningten, 1 TLS 657, 665 (1965). In sum, once the duty te bargain exists, change whieh **. .. denies the Roard |. . ultimate control, of the bargaining unit . . . disrupts the bargaining process."" Dowds v. 1. L. A. supre at 283. SS 11 matter, merge negotiations at all Company locations. More- over, the Committee expressly refused to execute an agree- ment in any one unit until agreement was reached in all other pending negotiations. In short, under the decision below, the Company would no longer be negotiating on a anit-by-unit basis ax required by Section 9 of the Act, but, as a matter of absolute economic necessity, would be com- pelled to negotiate with the unions on a company-wide hasis."" CONCLUSION. Thi» case raises a recurring and substantial problem in the administration of the Act. It is an issue which, unless resolved by thix Court, ix likely to engender further severe economic dislocation. By considering this question, the Court's time will not be misspent. The petitions for writs of certiorari should be granted. Respectfully submitted, MILTON A. SMITH, ~ V1. This result is wholly inconsistent with this ( .art’s repeated warning that it ““must net be guided by a single sentence or member of a sentence. but look to the provisions of the whole law. and its object and policy.”” Pittsburgh Plate Glass, 404 U.S. at 185, citing, infer alia Mastro Plastics Corp. v. N. L. R. B., 350 tS. 270 (1956). = SPURT PAPER EI Pn RS A c Ss yo