Opposition Brief — Cylinder Gas, Chemical, Petroleum, Auto-Service & Accessory Drivers, Local No. 283 v. Ottawa Silica Co.

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Loca. No, 283, onion BROTHERHOOD OF

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THE UNITED STATES. COURT OF APPEALS FOR

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Riniat 1 ‘Borx, |

Solicitor General,

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Peter G:NASH; ~~ © |” — D.C. 20530.

Joun S. IRVING,

Deputy General Counsel,

PATRICK HARDIN, — SA so aa ae

_ Associate General Counsel, — Bo eg Ng Ot Belo ee RN

Norton J. Come, © Gs See

Depuiy Associate General Counsel, ore igs:

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In the Supreme Court of the United States

OcTOBER TERM, 1973

No. 73-807

CYLINDER GAS, CHEMICAL, ETC., EMPLOYEES

Loca. No. 283, INTERNATIONAL BROTHERHOOD

OF TEAMSTERS, CHAUFFEURS, WAREHOUSEMEN

AND HELPERS OF AMERICA, PETITIONER

Vv.

OTTAWA SILICA COMPANY

AND

NATIONAL LABOR RELATIONS BOARD

ON PETITION FOR A WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS FOR

THE SIXTH CIRCUIT

BRIEF FOR THE NATIONAL LABOR RELATIONS BOARD

IN OPPOSITION

OPINIONS BELOW

The opinion of the court of appeals (Pet. App. Al-

A2) is reported at 482 F. 2d 945. The decision and

order of the National Labor Relations Board (Pet.

App. A3-A34) are reported at 197 NLRB No. 53.

JURISDICTION

The judgment of the court of appeals was entered

on August 22, 1973 (Pet. App. Al). The petition for

a writ of certiorari was filed on November 20, 1973.

(1)

2

The jurisdiction of this Court is invoked under 28

U.S.C. 1254(1).

QUESTION PRESENTED

Whether, in the circumstances of this case, the

Board properly concluded that the employer did not

violate Section 8(a)(1) and (3) of the National Labor

Relations Act by locking out his employees and con-

tinuing operations with temporary replacements

obtained from outside the bargaining unit, in order

to further his legitimate bargaining position.

STATUTE INVOLVED

The relevant provisions of the National Labor Rela-

tions Act, as amended (61 Stat. 136, 29 U.S.C. 15],

et seq.), are set forth at page A35 of the petition.

STATEMENT

A. The Board’s Findings of Fact

Ottawa Silica Company operates a plant at Rock-

wood, Michigan, where it mines, processes, and dis-

tributes silica sand, primarily to customers who

utilize it in the manufacture of glass (Pet. App. A26;

J.A. 75-77).! The Company’s glass customers operate

their furnaces continuously seven days a week and,

because storage capacity is limited, the customers

require a regular, uninterrupted supply of silica sand

(Pet. App. A26; J.A. 110, 121-122, 123). Indeed,

the customers maintain “daily communication”

with the Company regarding the progress of ship-

ments en route (Pet. App. A26; J.A. 112-113).

If a glass furnace must be taken out of production

1“J.A.” refers to the joint appendix to the briefs in the court

of appeals.

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3

because of a shortage of silica sand, the customer

may lose production with a retail value of $35,000

per day (Pet. App. A26-A27; J.A. 125).

Since May 19, 1967, petitioner Union has been

the certified bargaining representative of the Company’s

production and maintenance employees at the Rock-

wood plant (Pet. App. A23).2 Shortly after certifi-

cation, the parties entered into a collective bargaining

contract which expired on May 31, 1970 (Pet. App.

A23). Prior to the expiration date, Union repre-

sentative Vitale notified the Company that the Union

desired to open negotiations on a new contract (Pet.

App. A23).

From May 15 to May 31, 1970, the parties met on

at least four occasions in an effort to reach agreement

on a new contract (Pet. App. A23). At the May 25

meeting, Union President Schultz stated that “the comp-

any was going to pay, and pay through the nose”

and that “if there was a strike the union would strike

the company everywhere it operated * * *” (Pet. App.

A23; J.A. 89). At the May 29 meeting, Vitale depre-

cated the Company’s three new economic proposals, stat-

ing: “If that’s all you’ve got, you deserve a strike.”

Vitale also stated that the Union’s negotiating committee

“was empowered to call a strike” (Pet. App. A23;

J.A. 92). The Union rejected the Company’s request to

extend the current agreement for a week in order to per-

mit the Company to “operate successfully and in good

faith with its customers * * *” (Pet. App. A23; J.A. 93).

The Union insisted that any extension be on a day-to-day

basis (Pet. App. A23; J.A. 68). At the May 31 meeting,

2 From 1940 to 1967 these employees had been represented by

another labor organization (Pet. App. A23).

4

the Union representatives told the Company that they

would urge the employees to reject the Company’s final

contract proposals (Pet. App. A24; J.A. 94, 83). At the

conclusion of this bargaining session, the Company an-

nounced that the 72 bargaining unit employees would

be locked out effective immediately and that they would

be replaced by supervisors (Pet. App. A24; J.A. 57).

Between June | and June 5, the Company maintained

enough production to supply silica sand to its glass

customers by utilizing 23 non-unit employees, including

supervisory and sales personnel, and supervisors trans-

ferred from its Ottawa, Illinois plant (Pet. App. A24,

A27; J.A. 58, 80). On June 5, the Company informed

the Union by telegram that the unit employees could

return to work on June 7 “under the same terms and

conditions of employment as existed on May 3i, 1970”

(Pet. App. A24; J.A. 53, 100). On June 6, the Company

sent a similar telegram to each of the unit employees

(Pet. App. A24; J.A. 54). On June 7, the unit employees

voted to reject the Company’s contract proposals and to

strike (Pet. App. A24-A25; J.A. 59-60). On June 8,

the Union established a picket line at the Rockwood

plant. The strike continued until October 25, 1970, when

the parties reached agreement on a contract and all

strikers were recalled to work (Pet. App. A25; J.A. 81,

60).

B. The Decisions Below

The Board (with two Members dissenting) held that

the Company’s lockout and use of non-unit, temporary

replacements did not violate Section 8(a)(1) and (3) of

the Act, and accordingly dismissed that portion of the

5

complaint (Pet. App. A3-A19).3 Two Members of the

Board majority considered the Company’s conduct per-

missible because it was neither motivated by “antiunion

considerations” nor “intended to discourage the exercise

of protected employee rights,” and the harm resulting

to employee rights was “comparatively slight” since “the

replacements were expressly used for the duration of the

labor dispute only” (Pet. App. A8-A9). Chairman Miller

agreed that the conduct was permissible because, in the

circumstances here, the Company “utilized only its own

nonunit personnel in carrying on its operations during

the lockout,” there was “reason to believe that a strike

was imminent,” and there was “some evidence * * * of

a bona fide business justification for [the Company’s]}

actions” (Pet. App. All).

The court of appeals sustained the Board’s dismissal

of the complaint. It found “substantial evidence on the

whole record in the unique circumstances of this case to

support the findings of fact and conclusions of law of

the Board majority” (Pet. App. Al-A2).

ARGUMENT

The holding of the court below that an employer,

under the circumstances here, mi continue operations

with temporary replacements during an otherwise law-

ful lockout is correct. No issue warranting review by this

Court is presented.

1. In American Ship Building Co. v. National Labor

Relations Board, 380 U.S. 300, this Court held that “an

3 The Board also dismissed another portion of the complaint

and affirmed the Examiner’s finding that the Company violated

Section 8(a)(1), (3) and (5) of the Act by its unilateral refusal

to award holiday and vacation pay to the locked-out employees

(Pet. App. A3-A4). These rulings are not contested here.

os unlentie ihe oe oe GEES plea:

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employer violates neither §8(a)(1) nor §8(a)(3) when,

after a bargaining impasse has been reached, he tem-

porarily shuts down his plant and lays off his employees

for the sole purpose of bringing economic pressure in

support of his legitimate bargaining position” (id. at 318).

The Court concluded that a lockout in these circum-

stances was neither so destructive of employee rights

nor so devoid of a significant economic justification as

to constitute a violation of these sections, absent a spe-

cific showing of anti-union motivation.

While the Court intimated no view “as to the conse-

quences which would follow had the employer replaced

his employees with * * * temporary help” (id. at 308,

n. 8), in National Labor Relations Board v. Brown,

380 U.S. 278, decided the same day, it ruled that a

lockout of employees by the non-struck employers of a

multi-employer bargaining association, followed by the

use of temporary replacements to maintain operations,

was not proscribed by Section 8(a)(1) and (3) of the

Act. The Court acknowledged that “the use of tem-

porary nonunion personnel in preference to the locked-

out union members was discriminatory,” but concluded

on balance that “any resulting tendency to discourage

union membership was comparatively remote” and that

the use of temporary replacements constituted a “mea-

sure reasonably adapted to the effectuation of a legiti-

mate business end” (id. at 288).

The principle reflected in American Ship Building and

Brown is that the propriety of an employer’s use of

economic weapons to further a legitimate bargaining

position is to be determined by balancing, in each case,

the motivation of the employer and the impact of those

weapons on employee rights against the substantiality

of the business justification shown by the employer.

eee ere

7

See National Labor Relations Board vy. Great Dane

Trailers, 388 U.S. 26, 33-34; Lane v. National Labor

Relations Board, 418 F. 2d 1208, 1211 (C.A. D.C.).

2. The Board’s decision here constituted a proper

application of this principle to the facts of this case.

The Board found that the Company’s lockout and use of

temporary replacements were not motivated by union

animus or by a purpose to restrain its employees in

the exercise of Section 7 rights (Pet. App. A9, All).

It further found that the Company did not hire new

employees. to perform the work of the locked out

employees, but merely used its own personnel who

were not in the locked out unit; that the non-unit

replacements were used only for the duration of the

labor dispute; that the Company offered reinstatement

to all regular unit employees when the lockout ended on

June 7; and that all were immediately returned to

work when the strike ended in October 1970.

In these circumstances, the Company’s action had no

significant impact on the unit employees’ right to bargain

collectively through their union representative. Indeed,

the company’s conduct actually resulted in the employees

reaffirming their support for the Union, for the entire

unit backed the Union’s bargaining position throughout

a four-month strike. Finally, the Company’s action was

supported by legitimate business considerations. Union

negotiators expressly stated that a strike was likely as

soon as the contract expired, and refused to grant the

Company a one-week extension of the contract to enable

it to service its glass customers. At least two of the

Company’s major glass customers gave notice that any

interruption of deliveries would result in a search for

a new supplier (Pet. App. All; J.A. 114, 115, 111,

118, 136, 127, 137, 139-140).

8

The Board’s holding is in accord with that of the

a Eighth Circuit in Bookbinders Local No. 60 v. National

" Labor Relations Board (Inter-Collegiate Press), Nos.

1 72-1573 and 72-1749, decided October 25, 1973, 84 LRRM

2562, which involved a similar fact situation. And, the

court below correctly held that the Board’s findings

and conclusions were supported by substantial evidence.

3. Inland Truck Co. v. National Labor Relations Board,

4 440 F. 2d 562 (C.A. 7), certiorari denied, 404 U.S. 858,

relied upon by the Union, is distinguishable. There,

> the court sustained the Board’s finding that the use of

temporary replacements during an otherwise lawful

lockout was a violation of Section 8(a)(1) and (3) of

the Act. However, there, unlike here, the employer

hired some new employees (179 NLRB 350, 352),

and hence its action was more destructive of the bar-

gaining rights of the locked-out employees.‘ Moreover,

unlike here, there was no evidence of a bona fide

business justification for the employer’s action (id.

at 359), and the union advised that it had no intention

of striking and offered to give prior notice if it decided

to do so (id. at 352).5

4 As the court emphasized in /nland (440 F. 2d at 564): “Employees

[were] forced, at the initiative of the employer, not only to

forego their job earnings, but, in addition, to watch other workers

enjoy the earnings opportunities over which the locked out employees

were endeavoring to bargain.”

5 Although the court, in /niand, stated that “a lockout * * *

accompanied by continued operation with replacement labor, is per

se***an unfair labor practice under §158(a)(1),” that state-

ment was qualified by the phrase “in the circumstances at bar”

(440 F. 2d at 565).

DINER ORAL HEINER EH IEE LOBE IEE HELLER MOISE MP" OE SEU RAR en em RIE —

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CONCLUSION

The petition for a writ of certiorari should be denied.

Respectfully submitted.

Rosert H. Bork,

Solicitor General.

PETER G. NASH,

General Counsel,

JOHN S. IRVING,

Deputy General Counsel,

PATRICK HARDIN,

Associate General Counsel,

NorTON J. Come,

Deputy Associate General Counsel,

WILLIAM H. DuRoss, III,

Attorney,

National Labor Relations board.

JANUARY 1974,

DOJ-1974-01