Amicus Curiae Brief — NLRB v. Sears, Roebuck & Co.
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IN THE
Supreme Court of the Gnited States
OCTOBER TERM, 1973
No. 73-1233
rr
NATIONAL LABOR RELATIONS BOARD AnD
PETER G. NASH, GENERAL COUNSEL,
Petitioners,
VS.
SEARS, ROEBUCK AND CO.,
Respondent.
ON: WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT
BRIEF ON BEHALF OF THE CHAMBER OF COMMERCE
OF THE UNITED STATES OF AMERICA,
AS AMICUS CURIAE, IN SUPPORT OF
RESPONDENT .
——_—_——————
MILTON SMITH
General Counsel
RICHARD BERMAN
Labor Relations Counsel
Chamber of Commerce of the JERRY KRONENBERG
United States of America JULIAN D. SCHREIBER
1615 ‘iH Street, N.W. HOWARB L. MOCERF
Washington, D.C. 20006 120 South LaSalle Street
Chicago, Illinois 60603
Of Counsel: Attorneys for Amicus Curiae.
BOROVSKY, EHRLICH &
KRONENBERG
120 South LaSalle Street
Chicago, Illinois 60603
Gunthorp-Warren Printing Company, Chicago @ 346-1717
TABLE OF CONTENTS
PAGE
Interest of the Amicus Curiae... <6 2 <s0ncecscsnceer 1
Summary of the Argument..............-....00008. 3
FUGUE ec a hs 24 6 es baw oe 44 ee ea 8s eee es 5
I. Disclosure of the Advice and Appeals Decisions Is
Mandated by Congressional Will and the Needs of
Se PAIGE c= x oo ioe see eee ss os eee ees one 5
II. The Act’s Standards for Disclosure Are Satisfied... 14
A. Exemption 5: Intra-Agency Memoranda.... 14
B. Exemption 7: Investigatory Files .......... 15
C. Exemption 2:. Internal Personnel Rules and
PUOCUCEE oii 4 ne sew eee eee nea oe 17
INI. The District Court Properly Required That Com-
plete Advice and Appeals Decisions Be Produced.. 18
'V. Disclosure Must Be Prompt with Decisions Prop-
Cry TWGCKOG. ono ha hea toss oes e ens reese 19
WONCHISION. 6.04 440i wo o4 oho oa 45 ed ee E He eRe SS Ewes 20
POCO. cc eke ee eae tsas 4 e445 ne Fe cae ede ae oeu Al
Co sate eres
TABLE OF AUTHORITIES CITED
Cases
Aspen v. Department of Defense, 491 F.2d 24 (CA DC,
Ly Eh a ee eee yee es ee
Automobile Club of Missouri v. National Labor Relations
Board, et al., Appellants, Chamber of Commerce of the
United States, Intervenor, ............ F.2d ........... (1973), 84
ERRM 2423 (1979) onc. vases ener es ce eet 3a ss
Benson v. G.S.A., 289 F.Supp. 590 (W.D. Wash., 1968),
aff'd. on other grounds 415 F.2d 878 (CA 9, 1969)...
Boys Markets v. Retail Clerks Union, 398 U.S. 235 (1970)
Bristol-Myers v. F.T.C., 424 F.2d 925 (CA DC, 1970)..
Columbus Building & Construction Trade Council, AFL-
CIO, et al. (The, Chamber of Commerce of the United
States of America, Cases No. 9-CC-706-2 through -20. .
Connell Construction Company, Inc. v. Plumbers and
Steamfitters Local Union No. 100, etc., No. 73-1256...
Consumers Union of United States, Inc. v. V. A., 301
F.Supp. 976 (S.D.N.Y.) appeal dismissed because moot,
436 F.2d 1363 (CA 2, 1971) osc occccesecesvicnccs
Corning Glass Works v. Brennan, No. 73-29...........
Environmental Protection Agency v. Mink, 410 U.S. 73
CTOIS) cad denies onene es eeevens sesstaseeseaees
Evans v. Department of Transportation, 446 F.2d 821 (CA
5, 1971), cert. denied 405 U.S. 918 (1972)....... oe
Grumman Aircraft Engineering Corp. v. Renegotiation
Board, 482 F.2d 710 (CA DC, 1973), cert. granted
No. 73-1316 argument set in tandem with the instant
CONE coe 5 Peay sens yee Seenee sb beseG ey does e ees
16
17
Hawkes v. I.R.S., 467 F.2d 787 (CA 6, 1972). ..6, 16, 17, 18
Hourihan v. N.L.R.B., 201 F.2d 187 (CA DC, 1953),
cere, den. 345 US: 990. 6. cckeste eves iceseaness 7
Leedom v. Kyne, 358 U.S. 184 (1958)............... 11
Marco DeFunis, et al. v. Charles Odegaard, et al., No. —
dX | er ee ee. ee ree 2
N:L.R.B. v. Bell Aerospace Company, Division of Textron,
WG ING: T1096 ns ong ees See es tee ee ee tesanss z
N.L.R.B. v. The Boeing Company, et al., 93 S.Ct. 1952.. 2
N.L.R.B. v. Granite State Joint Board, 409 U.S. 157
(A971) s32%. fee eee een eee eee eee e renee e eens 2
N.L.R.B. v. Pittsburgh Plate Glass Co., 404 U.S. 517
C1971) eevee eye se eee onsen oe ees el eee ea caas 2
Soucie v. David, 448 F.2d 1067 (CA DC, 1971)....... 15
Sterling Drug, Inc. v. F.T.C., 450 F.2d 698 (CA DC,
EOTEY oe e ee ne eee eee bee say ae eee eee es ees es 6, 14
Stokes v. Brennan, 476 F.2d 699 (CA 5, 1973)....... 16, 18
Super Tire Engineering Company v. McCorkle, et al., No.
DAO OW oo oes bs 5456 a oe tha Oe heehee ses 2
Terminal Freight Cooperative Assn., et al. v. N.L.R.B.,
447 F.2d 1099 (CA 3, 1971), reh. den. 461 F.2d 777, -
cert. den. 81 LRRM 2894.....................0.4. 7
Vaca v. Sipes, 386 U.S. 171 (1967)................. 7
Statutes
Administrative Procedure Act. Section 3, 5 U.S.C. Section
C11? i ae ee ere ee eee eee 5
Freedom of Information Act, 5 U.S.C. Sec. 522, et seq... passim
National Labor Relations Act, 29 U.S.C. 151, et seg...... 3
PON RS tat
iv
Miscellaneous
Administrative Law—1973, 1974 Duke L. J. 251....... 15
Davis, Administrative Law Treatise (1970 Supp.), Section
ct oe eS ee ee ee ere eae 18
Davis, The Information Act: A Preliminary Analysis, 34
Uy. Chi. L, Rev. 761 (1961) 6c vcs cece dvadcses 6, 15
The Freedom of Information Act: A Seven Year Assess-
ment, 74 Col. L. Rev. 895 (1974) ccc ccccesecsss 17, 18
1970 Report Labor Relations Law Section American Bar
Association, Vol. II.......... Ova Rw se Oe eee ESE 13, 20
1971 Report Labor Relations Law Section American Bar
Association, Vol. I].......... 0.0.2.0. c ee eee eee ee 9
1972 Report Labor Relations Law Section American Bar
PBAOCIMEION, VOR TNs cog oes ca eae ees sae 84 ener es 13
1973 Report Labor Relations Law Section American Bar
Association, Vol. II................ 0.0. cee ee eee 13,19
1974 Report Labor Relations Law Section American Bar
PUBORINIIONE ce oo oo io a es ss hee 9 5a 2 es 13
H. R. No. 92-1419, 92nd Cong., 2nd Sess. (1972)...... 6
H. Rep. No. 1497, 89th Cong., 2nd Sess. (1966)....... 13
S. Rep. No. 813, 891th Cong., Ist Sess. (1965). ..5, 6, 15, 16, 17
Statement of the General Counsel submitted to the House
Labor Subcommittee on the N.L.R.B. on June 29, 1961,
reported at Para. 1150.01, CCH Labor Law Reports. . .
IN THE
Supreme Court of the Anited States
OcTOBER TERM, 1973
PARES SAIOR SR ROE RR Rae tema t
Se eee
No. 73-1233
NATIONAL LABOR RELATIONS BOARD AND
PETER G. NASH, GENERAL COUNSEL,
Petitioners,
vs.
SEARS, ROEBUCK AND CO.,
, Respondent.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT
BRIEF ON BEHALF OF THE CHAMBER OF COMMERCE
OF THE UNITED STATES OF AMERICA,
AS AMICUS CURIAE, IN SUPPORT OF
RESPONDENT
INTEREST OF THE AMICUS CURIAE!
The Chamber is a federation consisting of a membership of
over 3,700 state and local chambers of commerce and trade and
professional associations, a direct business membership in excess
of 38,000 and an underlying membership of approximately
5,000,000 business firms and individuals. It is the largest associa-
tion of business and professional organizations in the United
States.
1. Consent of Respondent and Petitioner’s statement that he
will not interpose any objection to the Chamber’s participation have
been filed with this Court.
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The Chamber regularly represents the interests of its member-
employers in important labor relations matters vitally affecting
those interests. Such representation constitutes a significant aspect
of the Chamber’s functions. Accordingly, the Chamber. has
sought to advance those interests in a wide spectrum of labor
relations litigation before this Court.’
The question presented in the instant case, whether parties
before the General Counsel of the National Labor Relations
Board are entitled to disclosure of decisions which contain
orders and directions controlling the disposition of their cases
before the General Counsel and the Board, is an issue of partic-
ular concern to the Chamber’s members who have an unsatis-
fied need to know the information contained in the General Coun-
sel’s Advice and Appeals decisions, since such decisions would
otherwise comprise an undisclosed body of law which controls
and governs their labor relations practices and policies.
Moreover, the decision of the court below, requiring the
General Counsel to disclose the heretofore secret Advice and
Appeals decisions, comports with the letter of as well as the
sound policy underlying the Freedom of Information Act* and
benefits not only employers, but all others—labor organizations
as well as individuals—who are affected by the General Counsel’s
orders and directions. Because of its broad representation of a
large class of those so affected and the importance to them of
this issue, the Chamber believes it appropriate to present its views
to this Court, in support of the decisions below.
2. E.g., Connell Construction Company, Inc. v. Plumbers and
Steamfitters Local Union No. 100, etc., No. 73-1256; Marco De-
Funis, et al. v. Charles Odegaard, et al., No. 73-235; Super Tire
Engineering Company v. McCorkle, et al., No. 72-1554; Corning
Glass Works v. Brennan, No. 73-29; N.L.R.B. v. Bell Aerospace
Company Division of Textron, Inc., No. 72-1598; N.L.R.B. v. The
Boeing Company, et al., 93 S.Ct. 1952; N.L.R.B. v. Granite State
Joint Board, 409 U.S. 213 (1972); N.L.R.B. v. Pittsburgh Plate
Glass Co., 404 U.S. 517 (1971); Boys Markets v. Retail Clerks
Union, 398 U.S. 235 (1970).
3. 5 U.S.C. Sec. 552, et seq. (hereinafter also called the FOIA
or the Act). ;
SUMMARY OF THE ARGUMENT
I.
Congress’ purpose in enacting the Freedom of Information
Act, 5 U.S.C. Sec. 552, et seq. was to prevent prejudice to
citizens resulting from the intransigence of federal agencies in
refusing to make available a body of undisclosed secret agency
law governing the rights and interests of private parties involved |. °
in proceedings before those agencies. Accordingly, the Act re-
quires agencies to’ disclose and make available “final opinions
.., 4$ weil as orders made in the adjudication of cases” and
“instructions to staff that affect a member of the public.” (5
U.S.C. Sec. 552(a)(2)(A); (a) (2)(C).)
The General Counsel of the National Labor Relations Board
is conceded to be an agency within the meaning of the Act.
te
Further, under the National Labor Relations Act, as amended, | ‘
. \
29 U.S.C. Sec. 151, et seq., the General Counsel has the author-
ity to finally determine whether to issue complaints based upon
the unfair labor practice charges of private parties, whether to
dismiss those charges, and whether to accept a pre-complaint
settlement even over the objections of the charging party.
Further, he has authority to frame the issues to be litigated and
to decide the legal theory to be employed. The General Counsel’s
decisional authority in these respects is not directly reviewable
under the NLRA.
Many of the General Counsel’s final decisions or binding staff
instructions are conta#f®i in documents known as “Advice” and
“Appeal” decisions which dispose of unfair labor practice
charges. These documents contain the effective law of the Gen-
eral Counsel and control his disposition of the case under
consideration or even subsequent cases raising the same or
similar issues. Thus, they are the type of final orders and in-
structions to staff which the Act requires to be disclosed. The
General Counsel’s refusal to make these documents available to
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private parties so that they might know the law which controls
the disposition of their cases and thus be able to fully and ef-
fectively present their theories and arguments, results in the kind
of prejudice against which the Act is aimed.
II.
The exemptions contained in the FOIA are not applicable
to Advice and Appeals decisions, Exemption 5 was designed
to assure that memoranda reflecting individuals’ deliberations
or factional debates be kept confidential. However, Advice and
Appeals decisions do not contain these debates or deliberations;
consequently, such decisions cannot claim insulation from dis-
closure under exemption 5.
Exemption 7 is also inapplicable. This exemption was de-
signed to maintain the confidentiality of investigative techniques,
sources of information and statements of witnesses since their
publication may retard the agency’s ability to enforce the law.
Advice and Appeals decisions reveal neither informants nor in-
vestigative techniques and their disclosure will in no way im-
pede the General Counsel’s ability to enforce the law. On the
contrary, disclosure of these decisions containing as they do the
Agency’s operating Jaw will advance the Agency’s goal by en-
couraging knowledgable and voluntary compliance with the law.
Exemption 2 like exemptions 5 and 7 cannot immunize the
requested decisions from disclosure. The second exemption was
intended to insulate from publication only internal personnel
rules and practices devoid of any impact upon the public. Since
Advice and Appeals decisions do not contain internal personnel
rules and practices, as those terms are construed by the Senate
and lower courts, exemption 2 does not serve as a reliable
defense to prevent disclosure.
Ii.
The court below after finding that the FOIA dictates dis-
closure of Advice and Appeals decisions required, in addition,
that materials incorporated by reference in these decisions also
be disclosed and that the term “circumstances of the case”
sometimes found in these decisions be expanded to detail the
circumstances relied upon. The court’s rulings are correct; other-
wise, the General Counsel by shorthand drafting could render
the disclosed decisions incomprehensible and useless and the
mandates of the FOIA nugatory. Furthermore, the courts
guarded against any inappropriate disclosure by permitting
names of witnesses that may be included in the decisions at
issue to be deleted. In addition, the courts below properly
ordered prompt disclosure and indexing. .
ARGUMENT
I. Disclosure of the Advice and Appeals Decisions Is Mandated
by Congressional Will-and the Needs of the Parties
The FOIA represents Congress’ broad attempt. to permit
access to information heretofore unnecessarily concealed from
public view and reflects Congressional concern that the public
nuist hav2 a judicially enforceable right to obtain this informa-
tion from recalcitrant government officials. The Act was a
reaction, to the history surrounding Section 3 of the Admin-
istrative Procedure Act, 5 U.S.C. Section 1002 which, con-
trary to the intent of its sponsors, came to be regarded as a
statute endorsing governmental secrecy rather than disclosure.
Unlike the APA, the FOIA eliminates the “properly and di-
rectly concerned” test for access to information and instead
provides that official information shall be disclosed “to the
public”, “for public inspection”. Furthermore, the agency at-
tempting to withhold information bears the burden in an ex-
peditious district court hearing to establish that the requested
material is expressly exempt from disclosure.‘ It is now beyond
4. Environmental Protection Agency v. Mink, 410 U.S. 73
(1973); S. Rep. No. 813, 89th Cong., Ist Sess. 3, 9, 10 (1965).
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dispute that the FOIA must be construed to make available
the maximum information reasonably considered to be em--“
braced within the ambit of that Act.°
When the Act’s policy of maximum disclosure is coupled,
as in the instant case, with the genuine need of parties before
the General Counsel for administrative decisigns which exert
impact upon those dealing with the Agency, a compelling argu-
ment for publication is presented.
It is the parties involved in agency proceedings who, even
more than the general public, receive the benefits of disclosure
bestowed by the Act. These parties will be most often victims of
an agency’s mistakes and irregularities. Unless information con-
tained in these decisions impacting upon the public and parties
before the Agency is made available to these parties, agency
irregularities will go unnoticed and unremedied.®
5. Sterling Drug, Inc. Vv. F.T.C., 450 F. 2d 698 (CA DC, 1971);
Hawkes v. 1.R.S., 467 F. 2d 787 (CA 6, 1972); Davis, The Informa-
tion Act: A Preliminary Analysis, 34 U. Chi. L. Rev. 761 (1961).
6. The Senate manifested a direct concern for parties involved
in controversies with an agency:
“requiring the.agencies to keep a current index of their orders,
opinions, etc. is necessary to afford the private citizen the es-
sential information to enable him to deal effectively and knowl-
edgeably with the Federal agencies. This change will prevent
a citizen from losing a controversy with an agency because of
some obscure and hidden order or opinion which the agency
knows about but has been unavailable to the citizen simply
because he had no way in which to discover it. . .” (S.R. No.
813 at 7.)
The House, too, displayed its concern for the rights of plaintiffs who,
when involved in agency prdéceedings, seek information from the
agency:
“Information sought by plaintiffs from Government is likely to
be a perishable commodity and . . . delays . . . may result in
substantive damage to plaintiff's case. In some circumstances,
such foot-dragging in the courts can render the information
totally useless, if and when it is ever made available by the
Federal bureaucracy.” (Emphasis added) (H.R. No. 92-1419,
92nd Cong., 2nd Sess. 2 (1972).)
Thus, Congress’ quite clearly foresaw and intended that the FOIA
would be applied in pending matters.
:
In the instant case, the importance to litigants before the
General Counsel of that Agency's decisions whose disclosure is
at issue derives from the functions of that Agency.’ The General
Counsel of the National Labor Relations Board is congression-
ally charged in general with the-duties to investigate allegations
that the Labor Act has been violated, to determine if these
charges have merit, and if so, to-issue a formal complaint or to
seek to remedy these violatiéis by informal voluntary settle-
ment, If the General Counsel decides that the charges lack
merit, he jis to dismiss them without hearing. The scheme of the
Labor Act dictates that the Labor Board's role is restricted to
reviewing only those decisions which are made following formal
complaint and administrative hearing or following settlements
approved by that Agency in lieu of proceeding through a
hearing. Thus, the Board acts only with respect to the issues
framed by the General Counsel in his pleadings and the argu-
ments advanced by him during the hearing.“
Moreover, the judgment of the General Counsel in deciding
whether specific conduct violates the law, in framing the issues
to be litigated and in determining the appropriate relief, is
final and unreviewable.’ The unreviewable and final determina:
tions of the General Counsel are frequently contained in the
decisions whose disclosure is at issue in this case: Advice and
Appeals decisions.
7. It is conceded by the Petitioner that the General Counsel con-
stitutes an Agency. :
8. This discussion omits reference to representation matters aris-
ing under Section 9 of the Labor Act, which are not perinent here,
and is restricted to unfair labor practice cases arising under Sections
8 and 10. ‘
9. Hourihan v. N.L.R.B., 201 F. 2d 187 (CA DC, 1953), cert.
den. 345 U.S. 930; Vaca v. Sipes, 386 U.S. 171, 182 (1967);
Terminal Freight Cooperative Assn., et al. Vv. N.L.R-B., 447 F. 2d
1099 (CA 3, 1971), reh. den. 461 F. 2d 777, cert. den. 81 LRRM
2894. Under Section 3(d) of the Act, the General Counsel is con-
ferred with “. . . final authority on behalf of the Board, in respect
to the investigation of charges and issuance of complaints under Sec-
tion 10, and in respect to the prosecution of such complaints before
the Board, .. .”. (emphasis supplied )
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The Advice decisions represent a “final determination . . .” of
the General Counsel, recite “facts upon which the Advice Branch
relied in making its determination, the exact issue involved,
instructions for the processing of the case, and detailed legal
rationale including any pertinent Board or Court decisions.”?°
(emphasis supplied )
”
It is thus apparent from the General Counsel’s own ac-
knowledgment that these decisions are binding instructions to his
staff and contain that Agency’s construction of substantive law,
applied to the facts of the case under consideration. In these
decisions the General Counsel frames the issues, directs that a
complaint issue or declines to do so, and details his under-
standing of the applicable law. Where the decision dictates dis-
missal of the case, that decision is a final binding instruction
to his staff unless appealed. When Advice instructs the Regional
Office to issue complaint, it is the Advice Branch that has
framed the issues and supplied the legal theories and construc-
tion of the law. This determination to issue complaint and liti-
gate only pursuant to the theories developed by the General
Counsel is final. It appears that where Advice decides to pro-
ceed to complaint and enunciates the legal theory to be em-
ployed, the charging party may appeal only to the Advice
Branch of the General Counsel if this decision for any reason
fails to consider fully the charging party’s interests."
10. Statement of the General Counsel submitted to the House
Labor Subcommittee on the N.L.R.B. on June 29, 1961, reported at
Para. 115)0.01, CCH Labor Law Reports, 3076.
11. Thus, in his report on operations in 1961, the General
Counsel ‘stated following a discussion on the finality of Advice’s
determinations:
“Because of the complexity or novelty of the cases submitted
for advice, parties occasionally . . . seek personal conferences
with the General Counsel or the Assistant General Counsel.
Since it is of the utmost importance to understand fully the is-
sues, as well as the positions of the parties in these cases, such
meetings are ordinarily arranged. However, in order to avoid
any semblance of ex parte proceedings, all other parties in the
case are invariably and immediately notified of such meetings
9
Consequently, whether or not complaint is directed, the Ad-
vice decisions constitute final opinions and binding instructions
to the staff that affect a member of the public—the party \in-
volved in the agency’s proceeding.
Indeed, contrary to the General Counsel's assertion, Regional _
Directors are required to submit novel or important issues to
Advice and are obligated to follow the determination of the
Advice Branch. The record below does not disclose even a
single instance, where a determination by Advice was not fol-
lowed. The General Counsel is, of course, bound by the record
below. Since he has not demonstrated that Regional offices can
resolve cases in a manner contrary to the determination of Ad-
vice or Appeals, his suggestions to this Court that Regional
offices may act contrary to Advice or Appeals must be rejected
by this Court. Thus, the Regional offices have absolutely no
: discretion to act contrary to Advice’s final and binding con-
clusion. Further, Regional offices must issue complaints or dis-
miss charges in a manner wholly consonant with Advice and
Appeals decisions in similar cases. (See Respondent’s Brief,
page 17.)
Appeals decisions, like those of Advice, constitute a final
disposition of an appeal, and contain an analysis of the General
Counsel’s view of the substantive or procedural law and policy.’”
No further appeal lies from any decision that may be rendered
by the General Counsel’s Office of Appeals.
It is apparent that the nature of the requested decisions are
such that non-disclosure will substantially injure parties in-
volved in Agency proceedings. Thus, Advice and Appeals
and are given an equal opportunity to meet with the General
Counsel or the Assistant General Counsel and fully state their
position.” (see footnote 10)
See also, 1971 Report Labor Relations Law Section American Bar
Association p. 243 (Vol. II) where the Bar concluded that parties
have an opportunity to orally argue before the Advice Branch.
12. Statement of the General Counsel submitted to the House
Labor Subcommittee on the N.L.R.B. on June 29, 1961, reported at
Para. 1150.01, CCH Labor Law Reports, 3082.
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decisions are needed: first, to enable a charging or charged
party to-protect-his interests-and,_for-exampleteknewledgably—#_—
evaluate terms of any proposed settlement; second, to ade-
quately present an appeal to the General Counsel (such is the
use of these decisions in the administrative decision underly-
ing the instant case); third, to determine if the decision of the
General Counsel constitutes an abuse of discretion; fourth, to
evaluate whether the General Counsel's decision to issue com-
plaint contains the legal theory most appropriate the interests
of the public and charging party; fifth, to enable the charged
party to know the legal theory he must combat (since there
are no provisions for discovery under the Labor Act, this seems
to be a reasonably claimed right). In addition and ‘to elborate,
the interests of a party who files a charge alleging/a violation
of the Labor Act will be critically and adversely affected if
Advice and Appeals decisions in related cases are not promptly
disclosed at the time the charge is filed. That is, a charging
party must have access to Advice and Appeals decisions pre-
viously issued in related cases so that during the investigation
of his charge, he may rely upon these guides and present argu-
ments and evidence necessary to protect his interests before the
General Counsel has reached a decision on the merits of his
charge. Denial of access to these decisions at an early stage
during the investigation will result in the charging party being
unprepared and unable to argue the differences between his
case and those that may be relied upon by the General Counsel.
Without access to these decisions, the charging party will be
unable to advance alternative theories or to show the General
Counsel departed from precedent whether by accident or due
to a change in Agency policy. Fundamentally, without Advice
and Appeals decisions in related cases, the charging party is
unaware of the nature of the evidence he need introduce in
order to support the General Counsel (and a charged party
does not know what evidence he must counter. ) So also, with-
out these decisions a charging party whose charge is dismissed
11
by the General Counsel is unable to effectively frame his ap-
—_——_—eal_hecause he_does_not-knou._the theory,arguments-or- case
law relied upon by the General Counsel and therefore cannot
be certain that he is addressing himself directly to the General
Counsel’s position.’
Further, absent access to these Agency decisions, the charg-
ing party will not be able to determine whether the General
Counsel abused his discretion or disobeyed a statutory direc-
tion and thus assert the only basis he has to protest the General
Counsel’s refusal to issue a complaint. The FOJA thus enables
a party to have access to decisions that allow a party to deter-
mine if discretion is abused.**
Finally, non-disclosure of these decisions will frequently
prejudice a charging party should the matter go to formgl
hearing. Thus, the General Cotinsel’s agents charged with prose-
cutorial duties are obliged to follow the decision ofthe General
Counsel who frames the triable issues. These agents may mis-
interpret or mi8use documentary evidence or may not recognize
the full potential of available probative material or the most
advantageous theory to the charging party and public. Absent
disclosure of the General Counsel's theory and construction of
13. Moreover . non- -disclosure of the Appeals decisions will pre-
vent the aggrieved party from refuting or distinguishing the theories
ead law relied upon by the Office of Appeals when it closed tze case,
aad from effectively urging his position on a request for reconsidera-
tion. In the 1961 Statement, supra, the General Counsel stated that
while an initial decision of the Office of Appeals ordinarily closes
the matter, requests for reconsideration “are entertained”. In such in-
stances, the evidence in its entirety is carefully reviewed in the light of
reasons advanced by the changing party in support of his request and
all interested parties are notified of the disposition of the matter.
(Statement of the General Counsel submitted to the House Labor
Subcommittee on the NLRB on June 29, 1961, reported at Para.
1150.01, CCH Labor Law Reports, 3082.) However, the charging
party’s reasons may well miss the mark if he does not know the
theories and arguments with which he must contend, and he may con-
sequently lose his controversy with the General Counsel. That is
what Congress sought to avoid by the commands of the FOTA.
14. Leedom v. Kyne, 358 U.S. 184 (1958).
12
the law both in the proceeding then being litigated and in past
related cases, the primary party to the proceeding—the charg-
ing party—will lose his opportunity to maximize his litigation
posture or protect his rights from deliberate or unintentional
adverse acts of the prosecutor. Thus, the charging party needs
Advice and Appeals decisions in order to exercise its right to
convince the General Counsel to proceed en a theory more ac-
ceptable to the charging party's interests. Fobiber. the charging
party must have the opportunity afforded by disclosure of Ad-
vice decisions to determine if the field staff is following the
General Counsel’s directions.
A party charged with an unfair labor practice is equally at
the mercy of the General Counsel’s thoroughness and fairness.
Unless he has access to decisions relating to issues in his case
at a very early stage of the investigation and before the General
Counsel has crystalized his views, he will have no real oppor-
tunity to effectively confront, distinguish or refute the General
Counsel's theories, arguments and precedents that are contained
in these decisions and that will be relied upon by that Agency
or the Regional offices. .
It is evident that the General Counsel’s theories and interpre-
tations of the labor law are contained in Advice and Appeals
decisions and exert a substantial impact on the rights of litigants
before that Agency. The record is devoid of any evidence that
these decisions contain any reference to trial tactics or settle-
- ment directions. Consequently, disclosure will in no way im-
pede the General Counsel’s functions. Moreover, these decisions
need not have precedential value for the Labor Board for dis-
closure to be mandated by the FOIA. * The fact that these
decisions are relied upon by the General Counsel in issuing
binding staff instructions compels disclosure to the public.
Therefore, the Agency’s failure of disclosure herein violates
the congressional objective to promote disclosure and to curtail
15. The Labor Board is a separate agency, not to be confused
with the General Counsel.
13
unnecessary administrative secrecy, achieves a real but pointless
injury to the private interests of the litigants and causes the pub-
lic to lose the important protection to its collective interest of
knowing what law governs their interests—and why."®
16. Indeed, since 1970 the Labor Law Section of the American
Bar Association, consisting of leading members of the labor bar
representing both unions and management, determined:
“{T]hese ‘precedents’ [Advice and Appeals decisions] constitute
precisely the kinds of ‘final opinions, statements of policy and
interpretations’ and ‘instructions to staff that affect a member of
the public,’ which the Freedom of Information Act contemplates
should be indexed and made available to the public.”
Vol. If 1970 Report, Labor Relations Law Section, American Bar
Association, p. 7. The Labor Law Section has consistently adhered
to this position to the present time and with regard{o the instant case,
has urged the General Counsel to comply fully with the decisions of
the lower courts. Vol. II, 1972 Report, pp. 219:
“The Committee also inquired with respect to requests by
charging parties for advice memoranda in connection with a case
that was then being submitted to the Office of Appeals. The
Committee urged that such memoranda be supplied to the charg-
ing and charged parties because dismissal letters, as a rule, do
not apprise the parties of the issues and rationale which led to
the dismissal of the charge. . . . it still believes that there is no
substitute for the basic memorandum which, in most cases, con-
stitutes the only insight into the iaw and policy governing the
case.”
See also. Vol. IT, 1973 Report, p. 244. In the 1974 Committee Re-
ports. pp. 249-250 the Committee said:
. your Committee continues’to adhere to the view that where
documents are expressly incorporated by reference in memo-
randa, they should be produced (see 1973 Committee Report,
p. 4A). Moreover, where memoranda rely upon ‘circumstances
of the case’ or some other vague, imprecise, or wiidelineated
reference, explanatory materials should also be made available.
Finally, we believe that the General Counsel should not delete
material without fully explaining or justifying the basis for such
deletion.” (p. 250)
The lower court’s orders are consonant with the view of the Labor
Law Section and they do not de!ve into the decisional processes—the
agenda system of confrontation and discussion—but only direct the
production of “. . . the end product . . .” (H. Rep. No. 1497, 89th
Cong., 2nd Sess... p. 7 (1966) ) of that agenda process—the General
Counsel’s resultant final law.
On a quarterly basis the General Counsel does publish a summary
of a few cases which he deems to be of unusual interest. Of the
14
Il. The Act’s Standards for Disclosure Are Satisfied.
The resolution of the issues of disclosure in this cause turns
upon whether the Advice and Appeals decisions are final orders
or binding staff instructions affecting the public as the Chamber
and Respondent contend, or whether they are exempted intra-
agency communications, parts of. investigatory files or internal
personnel rules or practices, as the General Counsel «laims.**
. A. Exemption 5: Intra-Agency Memoranda
Two reliable guides have been developed to aid in determin-
ing whether the decisions requested here are required to be dis-
closed or instead fall within the ambit of exemption 5. First,
decisions reflecting agency policy and its view of the law arc
disclosable. Such documents are the agency’s end product and
represent its opinions or interpretations of law and policy.’* On
the other hand, documents containing factional debates or in-
dividuals’ deliberations as the agency strives to formulate its
policy or interpretation of the law may be kept confidential.
These criteria reflect the design of the fifth exemption which
dictates that officials should be judged by their decisions rather
hundreds of other cases coming within his jurisdiction nothing is
published. See, e.g., Columbus Building & Construction Trade Coun-
cil, AFL-CIO, et al. (The Chamber of Commerce of the United States
of America) Cases Nos. 9-CC-706-2 thru -20. (A. 1) There is
no justification to refuse to disclose other Advice and Appeals deci-
sions simply because the Agency does not deem them to possess un-
usual interest.
17. Under the design of the FOTIA, an agency must bear a
weighty burden when it seeks to delimit disclosure of requested read-
ily identifiable documents. Bristol-Myers v. F.T.C., 424 F.2d 925
(CA DC, 1970). :
18. Sterling Drug, Inc. Vv. F.T.C., supra, where the court stated:
“(P}rivate transmittals of binding agency opinions and inter-
pretations should not be encouraged. These are not the ideas and
theories which go into the making of the law, they are the law
itself, and as such should be made available to the public. Thus,
to prevent the development of secret law within the Commission,
we must require it to disclose orders and interpretations which
it actually applies in cases before it.” Id. at 708.
15
than by the matters they examined before reaching their con-
clusions.’® ,
Viewed against these tests, it is apparent that Advice and Ap-
peals decisions are disclosable. Advice and Appeals decisions, as
stated, supra, constitute the General Counsel’s final opinions,
construction of substantive and procedural law and/or manda-
tory staff instructions.*°
Furthermore, as demonstrated by the Respondent, neither
Advice nor Appeals decisions contain the internal debates or
disputes of staff members that precede the determination of
the General Counsel’s policy and the formulation of his view of
the law. Therefore, production of these documents will not in
any manner stifle the deliberative process, and there is no need
to immunize them from disclosure by exemption 5.
In sum, the requested decisions not only enunciate Agency
policy and its construction of the law, (rather than individuals’
debates or opinions) but in addition dictate final and ultimate
Agency action. Exemption 5 is thus clearly inapplicable.*’
B. Exemption 7: Investigatory Files
Notwithstanding that the crux of Advice and Appeals de-
cisions represents the General Counsel’s position on substantive
law, that Agency now asserts that this operating law can be
19. ‘Congressional Commentaries demonstrate that Exemption 5
was designed to encourage frank deliberation before the agency’s
policy was formulated. S. Rep. 813, 89th Cong., Ist Sess. 3 (1965).
The courts and commentators have found similar objectives. Grum-
man Aircraft Engineering Corp. v. Renegotiation Board, 482 F. 2d
710, 718 (CA DC, 1973) cert. granted No. 73-1316; argument set
in tandem with the instant case. Soucie v. David, 448 F. 2d 1067
(CA DC, 1971). Davis, The Information Act: A Preliminary Analysis,
34 U. Chi. L. Rev. 761, 797 (1961).
20. Hawkes v. 1.R.S., supra. Professor Davis has stated that the
Act “calls for disclosure of all ‘opinions and interpretations’ which
embody the agency’s effective law and policy ....”. Davis, The In-
formation Act: A Preliminary Analysis, supra at 797.
21. Administrative law—1973, 1974 Duke L. J. 251, 271.
16
withheld from the public as a part of Agency investigatory files.
However, this. contention must fail inasmuch as exemption 7
was not designed to insulate from disclosure an agency’s effec-
tive law and policy.
Rather,' exemption 7 was intended for the limited purpose
of maintaining the confidentiality of investgiative techniques,
sources of information and statements of witnesses.** These
matters may be kept confidential when their revelation would
impede or defeat law enforcement. Accordingly, interrogation
techniques, mechanics of an FBI stake-out and selective en-
forcement policies necessary due to a lack of personnel may be
immune from disclosure, since publication would retard the law
enforcement responsibility of the agency.** On the other hand,
documents that reflect the agency’s “end product” and reveal
the agency’s position on substantive or procedural law, such as
Advice and Appeals decisions, must be disclosed under the terms
of the FOIA. Advice and Appeals decisions represent the
Agency’s “basis for administrative action” rather than traditional
confidential instructions, and accordingly are subject to “pub-
lic examination” even though the General Counsel may perform
investigative and prosecutorial functions. S. Rep. No. 813, 89th
Cong., Ist Sess. (1965), p. 2. Such decisions, when made pub-
lic, would aid law enforcement, rather than frustrate it, by en-
couraging knowledgable compliance with the Agency’s law.”
In short, since it is conceded that the requested decisions reveal
neither informants nor investigative techniques, exemption 7
does not foreclose their publication.*°
22. Aspen v. Department of Defense, 491 F. 2d 24 (CA DC,
1973); Evans v. Department of Transportation, 446 F. 2d 821 (CA
5. 1971) cert. denied 405 U.S. 918 (1972).
23. Hawkes v. I.R.S., supra; Stokes v. Brennan, 476 F. 2d 699
(CA 5, 1973).
24. Stokes v. Brennan, supra; Administrative Law—I1 973, 1974
Duke L. J. at 282. There, at note 169, Professor Davis reasons that
I.R.S. guidelines for staff in auditing of tax returns should be dis-
closed to the extent they reveal the position of the I.R.S. on questions
of tax law.
25. See Respondent’s Brief page 15. The General. Counsel has
failed in his burden to show belew that the requested decisions con-
‘
17
Exemption 2: internal personnel
rules and practices
Exemption 2, like exemptions 5 and 7, may not insulate the
requested decisions from public disclosure. Exemption 2 was
designed to protect from disclosure only documents pertaining
to employer-employee concerns which have no impact upon the
public.”* Furthermore, a review of precedents yields the conclu-
sion that lower courts have consistently applied a narrow con-
struction to this exemption. Thus, the words “internal” and
“personnel” have been found to modify both “rules” and
“practices” .??
This judicial construction of exemption 2 is consonant with
the Senate’s understanding of that cxemption’s scope. That is,
commenting on this exemption, the Senate said that internal
personnel rules and practices includes parking regulations,
lunch schedules and sick leave policies.** Thus, the courts and
the Senate have limited the reach of exemption 2 to matters
wholly devoid of impact upon the public.
While the House commentaries purport to include staff man-
uals within the ambit of this exemption, this interpretation has
tain informants or investigative techniques. Consequently, any asser-
tion that investigative matters or techniques will be revealed if dis-
closure is ordered should be rejected by this Court. Moreover, the
placement of these decisions in Regional office files cannot forestall
publication of the Agency’s operating law. The policies of the FOIA’
may not be flouted by this device.
26. Hawkes v. I.R.S., supra. According to that court, examples
of materials exempt from disclosure under the second exemption
include the amount of time an employee is to devote to his work and
instructions concerning an employee’s use of his employer’s equip-
ment.
27. Consumers Union of United States, Inc..v. V.A., 301 F.
Supp. 976, 800 (S.D.N.Y.), appeal dismissed because moot 436
F.2d 1363 (CA 2, 1971); Benson v. G.S.A., 289 F.Supp. 590, 594
(W.D. Wash., 1968), aff'd on other grounds, 415 F.2d 878 (CA 9,
1969). In addition, note: The Freedom of Information Act: A
Seven Year Assessment, 74 Col. L. Rev. 895, 957 (1974), here-
inafter, FOIA Assessment.
28. S. Rep. No. 813, supra at 8.
Ce Sh a os =
SAREE Pa ere
a a SRE fees
SUPRA Demet
ape Qty
Beeeteoeesrregememcreges
| Devel et, seek)
18
been criticized by Professor Davis’ and in addition conflicts
with other portions of the FOIA which in general require dis-
closure of instructions to staff.*°
It is apparent that if exemption 2 is to fit within the overall
design of the FOIA, ‘it must have been intended to have only
the narrow reach attributed to it by the Senate and the lower
courts. The House view conflicts with portions of the FOIA and
is antithetical to the Act’s disclosure mandates.*'
Viewing the content of the requested decisions against the
background of Senate commentaries on and judicial construc-
tion of exemption 2, it is apparent that these decisions do
not contain “internal personnel rules and practices” and are
not insulated by that exemption from disclosure.
Ill. The District Court Properly Required That Complete
Advice and Appeals Decisions Be Produced.
As Respondent stated (Brief 26-28) the drafters of Advice
and Appeals decisions often employ shorthand terms such as
the “circumstances of the case”, or refer to document which
are incorporated by reference.
29. Davis, Administrative Law Treatise (1970 Supp.) Section
3 A.9, 3 A.3l.
30. Pursuant to subdivision (a)(2)(c), staff manuals or memo-
randa containing the agency’s interpretation of substantive or pro-
cedural law are subject to disclosure. Indeed, courts have: immunized
these documents from disclosure only where publications may retard
the agency’s goals by enabling “law violators to escape detection.”
Hawkes v. 1.R.S., supra at 795. Thus, as stated supra, staff instruc-
tions concerning investigative methods may be kept confidential.
However, instructional manuals or memoranda containing the
agency’s view of the law must be disclosed since voluntary and
knowledgeable compliance with the law will thereby be encouraged
and the agency’s goals advanced. Hawkes v. I.R.S., supra at 795.
Stokes v. Brennan, supra, at 702. Note: FOIA Assessment, supra
at 904. :
31. The House report was drafted only under heavy agency
pressure after the FOIA had passed the Senate on the basis of a
committee report that was faithful to the words of the bill. Davis,
Administrative Law Treatise (1970 Supp.) Section 3 A.31.
19
It is apparent that documents incorporated by reference in
Advice or Appeals decisions must be disclosed and that con-:
versely, the Agency may not, be efficient drafting, insulate these
incorporated documents from disclosure. A decision in an Ad-
vice or Appeals document that turns upon the construction of
a contract clause, for example, is meaningless unless the con-
tract term as well as the decisional document is disclosed. Fur-
thermore, the technique of relying upon the “circumstances of
the case” without publishing those circumstances renders the
decisior , meaningless and the mandates of the FOIA nugatory. ia
Accordingly, when the General Counsel resorts to shorthand
terms or incorporates material by reference in decisional or
instructive documents, he must not only publish these decisions,
as discussed above, but also disclose the “circumstances” <<
upon and the incorporated material as well.**
IV. Disclosure Must Be Prompt with Decisions
Properly Indexed.
It is apparent thatethe mandate to disclose will be nugatory
unless it is accompanied with an order requiring that the dis-
closure be promptly accomplished and that the decisions be
indexed in a useful fashion. A subject matter index would be
most useful and effectuate the policies of the Act. In the most
recently adopted amendments to the FOIA, Congress required
both expeditious disclosure and indexing. (5 U.S.C. Section
§52(a)(a), 552(a) (4) (d), 552(a)(6).) Thus, Congress dem-
32. See the 1974 | Report, Labor Relations Law Section, Ameri-
can Bar Association, 250, footnote 16, supra.
33. There is no need to produce investigatory files to comply
with the disclosure requirement urged in the teat above. Indeed, the
District Court below did not order the production of these files. That
court instead permitted the General Counsel to select the method to
be used to supply facts missing from Advice and Appeals decisions
where the presentation of these facts was necessary for a complete
undersianding of these documents. The district court below also
permitted a deletion of affiant’s names from decisional documents
and did not require the production of witnesses’ affidavits or other
matter “exempt under the Act.”
2A Re Georgy SRR Ya PENN ' “a De eee |
cet OW
20
onstrated a continuing preoccupation with the public’s right
of access to hitherto confidential information.™
CONCLUSION
______ For the reasons set forth above, and those in Respondent's
brief} it is respectfully requested that the judgments of the courts
below be affirmed.
Respectfully submitted,
MILTON SMITH
General Counsel
RICHARD BERMAN
Labor Relations Counsel —
Chamber of Commerce of the JERRY KRONENBERG
United States of America JULIAN D. SCHREIBER
1615 H Street, N.W. HOWARD L. MOCERF
Washington, D.C. 20006 120 South LaSalle Street
Chicago, Illinois 60603
Of Counsel: Attorneys for Amicus Curiae.
BOROVSKY, EHRLICH &
KRONENBERG
120 South LaSalle. Street
Chicago, Illinois 60603
34. In addition, in Automobile Club of Missouri v. National
Labor Relations Board, et al., Appellants, Chamber of Commerce of
the United States, Intervenor, ........ eS ee (1973) 84 LRRM
2423 (1973), where indexing of representation cases was ordered
by the lower court, the Petitioner did not appeal this order to this
Court.
. The 1970 Report, Labor Relations Law Section, American Bar
Association, Vol. II, p. 9, states:
“However, your Committee believes the Board’s obligations
under the Freedom of Information Act cannot be indefinitely
delayed and that, in accordance with Congressional will ex-
pressed in the Act, the Board should immediately undertake the
preparation of an index and other suitable procedures for pub-
lic access to the Advice and Appeals Memoranda.” <
Al
APPENDIX
NATIONAL LABOR RELATIONS BOARD
Washington, D.C. 20570
PICKETING TO OBTAIN 8(e) PROVISO
AGREEMENTS IN CONSTRUCTION INDUSTRY
A number of cases have raised the issue of whether a con-
struction union violates sections 8(b)(4)(A) andor 8(e)
when it seeks or obtains by picketing an. otherwise valid on-site
construction subcontracting clause under the 8(e) proviso from
a contractor who does not himself employ employees of the craft
represented by that union.
The contentions of the Charging Parties as well as a number
of arguments developed by the General Counsel’s office itself,
have been considered in detail as has been the recent decision
of the Fifth Circuit Court of Appeals in the Connell case.’ The
General Counsel has concluded, for the reasons discussed fully
below, that there is not sufficient basis to authorize complaint
in these cases.
While not directly attacking the Board’s holding in Centlivre,?
it has been contended that an agreement entered into by or sought
between the contractor and the union is not within the privilege
of the construction industry proviso to Section 8(e), and that
the union’s conduct to obtain the agreement accordingly vio-
lated the Act, because the contractor did not employ employees
1. Connell Construction Company v. Plumbers & Steamfitters
Local No. 100, Sth Circuit, 72-1243, August 23, 1973.
2. Northeastern Indiana Building and Construction Trades
Council, et-al. (Centlivre Village Apartments), 148 NLRB 854,
enforcement denied on other grounds, 352 F.2d 606 (C.A. D.C.).
Oe
SNR aR pe oie RHE se:
ed
Te PANO FEDS
A2
of the craft represented by the union and had no collective-
bargaining relationship with the union.”
As the initial point of departure, the Board’s decision in
Centlivre, supra, which has been uniformly followed since its
decision ten years ago, is now settled law for the General
Counsel. The Board there accepted the view of alt those-€r1r-
cuit Courts of Appeal which had passed on the issue’ and had
uniformly rejected the Board’s prior view.‘ The Board in
Centlivre held, as had the Courts, that a union’s strike to obtain
an agreement which would be privileged under the construc-
tion industry proviso did not violate Section 8(b)(4)(A).°
Qa. Alternatively, it is argued that, although the agreement may
be privileged under the 8(e) construction proviso, the absence of a
collective-bargaining relationship between the contractor from whom
the agreement is sought and the union seeking the agreement, ren-
ders economic action by the union violative of Section 8(b)(4)(A).
However, the Board has made it clear that picketing to obtain such
a clause is not violative of Section 8(b)(4)(A), if the clause is
within the construction proviso. (See e.g. fn. 19, supra.) Thus. the
basic issue remains whether the sought-after clause comes within
the proviso.
3. Construction, Production & Maintenance Laborers Union,
Local 383, et al. v. N.L.R.B. (Colson and Stevens Construction Co.),
323 F.2d 422 (C.A. 9); Essex County and Vicinity District Council
of Carpenters and Millwrights, United Brotherhood of Carpenters,
etc. (Associated Contractors of Essex County, Inc.) v. N.L.R.B.,
332 F.2d 636 (C.A. 3); Orange Belt District Council of Painters
No. 48, AFL-CIO, et al. (Calhoun Drywall Co.) v. N.L.R.B., 328
F.2d 534 (C.A. D.C.). See also Local Union No. 48 of Sheet Metal
Workers v. Hardy Corp., 332 F.2d 682 (C.A. 5). -
4. The Board’s prior view set out in Colson and Stevens, 137
NLRB 1650, was that only voluntary agreements were within the
construction industry p.oviso to Section 8(e).
5. Section 8(b)(4)(A) of the Act, as amended by the Lan-
drum-Griffin Act of 1959, makes it an unfair labor practice for a
union to induce employees to strike or to threaten, coerce or re-
strain any person where an object is:
(A) forcing or requiring any employer . . . to enter into any
agreement which is prohibited by Section 8(e).
Section 8(b) (4) (B) could nevertheless, as in Centlivre itself, be vio-
lated if the union’s conduct sought the breaking of an existing busi-
ness relationship at the site of construction, i.e., had an immediate
cease doing business object.
\s
LEASE LENGE ECTS oe kt
A3
The Board there stated:
Subsequent to the issuance of Colson and Stevens, how-
ever, United States Courts of Appeals for three separate
circuits have considered and uniformly rejected the above
analysis and conclusion. In essence these cases hold that
the Board failed to give sufficient scope to the construc-
tion industry proviso to 8(e).
In view of the Centlivre holding, the Section 8(b) (4) (A)
and Section 8(e) issues of the instant cases turn on whether
the agreement entered into or sought between the contractor
and the union would violate Section 8(e) for the reasons urged
by the Charging Parties.
Section 8(e) provides in pertinent part:
“It shall be an unfair labor practice for any labor organi-
zation and any employer to enter info any contract or
agreement, express or implied, whereby such employer
ceases or refrains or agrees to cease or refrain from han-
dling, using, selling, transporting or otherwise dealing in
any of the products of any other employer, or to cease
doing business with any other person. and any contract or
agreement entered into heretofore or hereafter containing
such an agreement shall be to such extent unenforceable
and void: Provided, That nothing in this subsection (e)
EE eS GO a
eee
Fe a ee Te
shall apply to an agreement between a labor organization 3
’ and an employer in the construction industry relating to E
the contracting or sulscontracting of work to be done at the &
site of the construction, alteration, ai or repair of a 3
building, structure, or other work. '
Since the Union here is a “labor organization” and the con- E
tractor “an employer in the construction industry,” and since ig
: : ‘ =
their agreement is confined to the work to be done at the site .
of construction, the agreement clearly comes within the lan- é
guage of the proviso to Section 8(e). Left then are the conten- -
tions of the Charging Parties that there are two alternative im- e
plicit preconditions to the validity of an agreement otherwise ;
within the construction industry exemption: (1) that there be H
f
A4
an existing collective-bargaining relationship between the par-
ties to the agreement; or (2) that the employer party employ
employees doing the kind of work e¢overed or to be covered by
the agreement. These contentions are now considered.
While recognizing that a proviso to a general statutory pro-
hibition is to be narrowly construed, the contentions of the
Charging Parties cannot be considered on mere axioms of inter-
pretation since the purpose and scope of the construction in-
dustry proviso has been the subject of substantial Board and
Court litigation in the almost 15 years since its enactment.
The issues here raised involve, of course, a “secondary”
agreement to be applied to work at a site of construction and not
a primary agreement.®
“However, provisos were added to § 8(e) to preserve the
Status quo in the construction industry, and exempt the
garment industry from the prohibitions of §§ 8(e) and
8(b) (4) (B). This action of the Congress is a strong con-
firmation that Congress meant that both §§ 8(e) and 8(b)
(4)(B) reach only secondary pressures. If the body of
§ 8(e) applies only to secondary activity, the garment
industry proviso is a justifiable exception which allows
what the legislative history shows it was designed to allow,
6. The distinction from cases involving “primary” objects such as
union recognition sought through direct (picketing) pressure on an
employer is set out in the Court’s decision in Dallas Building Trades
Council v. N.L.R.B., 396 F.2d 677, 682 (C.A.D.C.): -
The Board’s responses to these arguments are, however, con-
vincing. First, there is no inconsistency between the Board’s in-
terpretation of Section 8(b)(7) and the purposes of Section
8(e). It simply does not follow from the fact that the agreement
would be lawful if voluntarily adopted that a labor organization
can employ illegal means to obtain it. Sections 8(b)(7Z) and
8(e) are aimed at wholly different problems. And the proscrip-
tions of Section 8(b)(7) do not vary with the legality of the
agreement sought. Picketing to obtain a wage agreement, for
example, is no more lawful than picketing to obtain a hot cargo
clause. (Emphasis supplied.)
See also Building and Construction Trades Council of Philadelphia
and Vicinity (Samuel E. Long, Inc.), 201 NLRB No. 42, 1973,
enfd. 485 F.2d 680 (C.A. 3, 1973).
AS
secondary pressures to counteract the effects of sweatshop
conditions in an industry with a highly integrated process
of production between jobbers, manufacturers, contractors
and subcontractors. First, this motivation for the proviso
sheds light on the central theme of the body of § 8(e),
from which the proviso is an exception. Second, if the
body-of that provision and § 8(b)(4)(B) were construed
ar ore Ss
tO Pronrort primary
such as those concerning work presefyation, the proviso
would have the highly unlikely effect, unjustified in any of
the statute’s history, of permitting garment workers, but
garment workers only, to preserve their jobs against sub-
contracting or prefabrication by such agreements and by
strikes and boycotts to enforce them. Similarly, the con-
struction industry proviso, which permits ‘hot cargo’ agree-
ments only for jobsite work, would have the curious and
unsupported result of allowing the construction worker to
make agreements preserving his traditional tasks against
jobsite prefabrication and subcontracting, but not against
nonjobsite prefabrication and subcontracting. On the other
hand, if the heart of § 8(e) is construed to be directed
only to secondary activities, the construction proviso be-
comes, as it was intended to be, a measure designed to
allow agreements pertaining to certain secondary activities
on the construction site because of the close community
of interests there,** but to ban secondary-objective agree-
ments concerning nonjobsite work, in which respect the
construction industry is no different from any other. The
provisos are therefore substantial probative support that
primary work preservation agreements were not to be
within the ban of § 8(e).” (At 637-639)
“32. See Essex County and Vicinity Dist. Council of Car-
penters Vv. Labor Board, 332 F.2d 636° (C.A. 3d
Cir. 1964); Comments, The Impact of the Taft-
Hartley Act on the Building and Construction In-
dustry, 60 Yale L.J. 673, 684-689 (1951).”
The Court’s statement has, of course, pointed significance
concerning both the legislative purpose underlying the construc-
ARTS OREN Ce 1
SERS WEE:
SORES RET
Berenson:
A6
tion industry proviso and the contentions of the Charging Parties
here. Thus the Court, as noted above, stated that the proviso
was:
“
. intended to be, a measure designed to allow agree-
ments pertaining to certain secondary activities on the con-
struction site because of the close community of interests
ie 4
+h 2. ta__h
tirere; DUt-to—Sban—a
concerning non-jobsite work, in which respect the con-
struction industry.is no different from any other.”
32. supra.
The Court’s citation at footnote 32 to the Third Circuit's:
decision, Essex County, supra, amplifies the meaning of “close
community of interests” at the construction site,’ which under-
lies the exemption.
7. The Court's citation of the Yale Law Journal Comment is
equally significant. That Comment, published shortly before the Su-
preme Court’s decision in Denver Building, expressed, at the pages
cited, disagreement with the Board’s finding of violation in the case
because of the relationships at a construction site. On page 689 of
the Comment this view is set forth as follows:
“The general contractor in the construction industry is in a
significantly different position. Unlike B, in the example above,
the general contractor’s own labor policies are the reason his
place of work is being picketed. For he has brought onto the job
a non-union subcontractor. This, as Judge Clark pointed out in
his dissent in the Electrical Workers case, is immediate cause of
the dispute. For purposes of 8(b)(4)(A) all the men working
on the job should be considered the general contractor’s em-
ployees; he should not be allowed to insulate himself from the
effects of having non-union men work side by side with union
men simply because the custom, and structure of the industry
places a subcontractor between him and direct employment of
the non-union men. In other words, the test should be whether
the direct employer of the non-union men (the subcontractor) is
sufficiently closely connected both geographically and economi-
cally with the direct employer (the general contractor) so that
the labor policies of the one may be attributed to the other. The
contractor-subcontractor relationship in the construction indus-
try should be held to satisfy this test.
The general contractor, however, should be regarded as the
employer of a subcontractor’s* employees only.for purposes of
that job where the two contractors are working together. There-
A7
The Third Circuit had explained it as follows:
This limited exemption was granted apparently in recogni-
tion of problems peculiar to the construction industry,
particularly those resulting from sporadic work stoppages
occasioned by the traditional refusal of craft unionists to
work alongside non-union men on the same project. (At
eageinbinepaiencsssccracs Ice t
Bl a
This view of the proviso’s purpose is also set forth in Drivers
Local 695 v. N.L.R.B.,* where the Circuit Court, in pertinent
part, stated:
“The purpose of the Section 8(e) proviso was to alleviate
the friction that may arise when union men work continu-
ously alongside non-union men on the same construction
site.??
22. See Essex County & Vic. District Council of Car-
penters, etc. V. N.L.R.B., 332 F.2d 636, 640 (3rd Cir.
1964); N.L.R.B. v. Denver Bldg. & Const. Trades Coun-
cil, 341 U.S. 675, 692, 71 S. Ct. 943, 95 L. Ed. 1284
(1951) (Douglas J. dissenting); Comment, Hot Cargo
Agreements Under the National Labor Relations Act:
An Analysis of Section 8(e), 38 N.Y.U.L.. Rev. 97, 111
(1963); Comment 45 Cornell L.Q. 724, 753 (1960).
And the dissent® in Denver Building, referred to in Drivers Lo-
cal 695, stated:
“The employment of union and nonunion men on the same
= job is a basic protest in trade union history. That was the
’ protest here. The union was not out to destroy the contrac-
tor because of his antiunion attitude. The union was not
pursuing the contractor to other jobs. All the union asked
fore, although a construction union trying to organize any sub-
contractor on a project should have the right to picket the en-
tire project, it should not be permitted to extend its activity to
other sites on which the picketing is to organize a particular job,
the geographical boundaries of that job should mark the con-
fines of the dispute.
~ /8. 361 F.2d 547, 551 (C.A. D.C., 1966).
9. Justices Douglas and Reed.
A8
was that union men not be compelled to work alongside
nonunion men on the same job. As Judge Rifkind stated
in an analogous case, ‘the union was not extending its
activity to a front remote from the immediate dispute but
to one intimately and indeed inextricably united to it.”
“The picketing would undoubtedly have been legal if there
had been no subcontractor involved—if the generat con-
tractor had put nonunion men on the job. The presence of
a subcontractor does not alter one whit the realities of the
situation; the protest of the union is precisely the same. In
each the union was trying to protect the job on which
union men were employed. If that is forbidden, the Taft-
Hartley Act makes the right to strike, guaranteed by § 13,
dependent on fortuitous business arrangements that have
no significance so far as the evils of the secondary boycott
are concerned. I would give scope to both § 8(b)(4) and
§ 13 by reading the restrictions of § 8(b)(4) to reach the
case where an industrial dispute spreads from the job to
another front.?
ef
>. 75 F. Supp.
7
1. Douds v. Metropolitan Fede
672, 677.
2. See the opinion of Judge Fahy below, 87 U.S. App.
D.C. 293, 186 F.2d 326; and the dissenting opinion of
Judge Clark, International brotherhood v. N.L.R.B., 181
F.2d 34, 40. .
It seems clear from the foregoing, even before proceeding to
consideration of the relevant Board decisions from Centlivre to
the present, that the construction industry proviso has been rec-
ognized as privileging what may be characterized as “Denver
Building Agreements” confined to the site of construction. That
is, while the Supreme Court decision in Denver Building was
not overruled,’® agreements covering Denver Building relation-
10. That Denver Building was not “overruled” by the Supreme
Court’s decisions in General Electric, 366 U.S. 667, and Carrier, 376
U.S. 492, is fully set-forth in the Board’s decision in Markwell and
Hartz. 155 NLRB 319, enfd. 387 F.2d 79 (C.A. 5); see aiso 383 F.
2d 562 (C.A. 6). Markwell and Hartz, however, gives no support to
the contentions of the Charging Party concerning construction in-
dustry on-site agreements.
EEOC Be La YONA ROE COLD 6 SOA NIIABEI aS" Ste PTI Satire te
A9
ships at a construction site were exempted from the prohibition
of Section 8(e).™
In sum then, since the construction industry proviso deals with
“secondary” agreements, the “community of interest” involved
is not tied to gS of “unit work a. but rather to
baled: on - this interest poate pr mt serena ‘diere
which, being “secondary” would otherwise and elsewhere be
prohibited.
The legislative history supports this view. As pointed out by
the Board in Centlivre at footnote 17:
“The intent of Congress to retain the then existing law in,
connection with secondary boycotts in the construction’
industry is apparent from the following statement by the
House conferees:
“The committee of conference does not intend that
this proviso should be construed so as to change the
present state of the law with respect to the validity of
this specific type of agreement relating to work to be
done at the site of the construction project, or to re-
move the limitations which the present law imposes
with respect to such agreements. Picketing to enforce
such contracts would be illegal under the Sand Door
cases (Local 1976, United Brotherhood of Carpenters
(and Joiners of America, AFL, et al. (Sand Door &
Plywood Co.)) v. N.L.R.B., 357 U.S. 93 (1958))..
To the extent that such agreements are legal today
under Section 8(b)(4) of the National Labor Relations
Act, as amended, the proviso would prevent such
legality from being affected by Section 8(e). The pro-
RUMI oy
2 PPT GRE eR ERENT OR
11. Denver Building itsclf points away from the Charging Parties’
contentions. Thus it appears that the neutral general contractor there,
Doose and Lintner, did not employ electricians but, rather, sub-
contracted electrical work to the primary nonunion electrical contrac-
tor, Gould and Preisner. Indeed the Supreme Court, in rejecting the
Union’s contention that it had a primary dispute with Doose and
Lintner in seeking to force Doose and Lintner to make the project an
all-union job, pointed out that “If. for example, Doose and Lintner
had been doing all the electrical work on this project through its own
nonunion employees, it could have replaced them with union men
and thus dispose of the dispute.” (At p. 688.)
SEARS PENNE tg CIN a eR RII
Al0
viso applies only to Section 8(e) and therefore leaves
unaffected the law developed under Section 8(b) (4).
The Denver Building Trades case and the Moore
Drydock cases would remain in full force and effect.
The proviso is not intended to limit, change, or mod-
ing at the site of a construction project. Restrictions
and limitations imposed upon such picketing under
present law as interpreted, for example, in the U.S.
Supreme Court decision in the Denver Building
Trades case would remain in full force and effect. .
House Conference Report on Labor-Management Re-
porting and Disclosure Act of 1959, House Report
1147, 86th Cong., Ist sessions, pp. 39-40.” (Empha-
sis supplied with respect to portions bearing on
“agreements.” )
This is supported further by the statements of Senators Ken-
nedy and Goldwater in the legislative history. Senator Kennedy
explained the 1959 amendments as follows:
“The first proviso under new section 8(e) of the National
Labor Relations Act is intended to preserve the present
state of the law with respect to picketing at the site of
a construction project and with respect to the yalidity of
agreements relating to the contracting of work to be done
at the site of a construction project.
“This proviso affects only section 8(e) and therefore leaves
unaffected the law developed under section 8(b) (4). The
Denver Building Trades (341 U.S. 675) and the Moore
Drydock (92 N.L.R.B. 547) cases would remain in force.
“Agreements by which a contractor in the construction
industry promises not to subcontract work on a construc-
tion site to a nonunion contractor appear to be legal today.
They will not be unlawful under section 8(e). The proviso
is also applicable to all other agreements involving under-
takings not to do work on a construction project site with
other contractors or subcontractors regardless of the precise
relation between them.’* Since the proviso does not relate
: at Relied on by the Board in Carvel, 152 NLRB 1672, discussed
elow.
All
to section 8(b) (4), strikes and picketing to enforce the
contracts excepted by the proviso will continue to be illegal
under section 8(b)(4) whenever the Sand Door case
(357 U.S. 93) is applicable.
“It is not intended to change the law with respect to the
judicial enforcement of these contracts; or with respect to
the legality of a strike to obtain such a contract.
“It should be particularly noted that the proviso relates
only to ‘contracting or subcontracting of work to be done at
the site of the construction.’ The proviso does not cover
boycotts of goods manufactured in an industrial plant for
installation at the jobsite, or suppliers who do not work
at the jobsite. [II Leg. Hist. Act of 1959, 1433(3).]”
(Emphasis supplied. )
And Senator Goldwater stated:
“There is a further exemption from the prohibitions against
‘hot cargo’ agreements only, under section 8(e), with respect
to a segmetnt of the building construction industry and the
labor unions representing employees in that segment of
the inaustry. This exemption is granted only where the
employer with whom such an agreement is signed is in the
construction industry and engages only in construction work
at the site; it does not apply where the employer, although
in the construction industry, is.not engaged in construction
work at the site such as enterprises primarily engaged in
supplying or transporting building construction materials.
Where an employer falls into this limited category, it is
not an unfair labor practice for such employer and a labor
union to enter into an agreement whereby such employer
ceases or refrains or agrees to cease or refrain from handl-
ing, using, selling, transporting or otherwise dealing in
any of the products of another employer, or to cease doing
business with any other person, and such an agreement is
not per se unlawful. Unlike the exemption for the apparel
and clothing industry, the prohibitions of the secondary
boycott ban in seétion 8(b) (4), as amended, are however,
. applicable to these situations. ,
“Thus, although employers and unions who are under this
exemption may lawfully enter into such agreements, and
ae |
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,
SPO Keer ee So
2 RASTA RIS
PROP RE PEs
ite ete ay
FAIR ae groggns
de RR ea Sa
wey
Al2
may resort to the courts for their enforcement under ap-
» plicable principles of contract law, no coercion or restraint
—economic or otherwise—may be used by any party to
such an agreement, even if entered into voluntarily by both
parties, to compel the other party to live up to the contract
anise niceneioeemennenlil i, etree Soom beesichine it" “iil Leg. Hist, (1959)
1858(1)] (Emphasis supplied. )
Turning now to consideration of relevant Board law from
4 Centlivre to the present, the Board decisions provide no sup-
port, but rather undercut, the contentions of the, Charging
' Parties.'’ In Centlivre itself, the Board, in accepting the view of
ly the Circuit Courts which had “uniformly rejected” the prior
Board view, stated: “in essence these [Court] cases hold that
the Board failed to give sufficient scope to the construction pro-
viso to Section 8(e).” The Board then treated the clauses there
- involved as within the construction industry proviso to Section
3 8(e)."* And the facts of Centlivre run contrary to the conten-
1 tions of the Charging Party here. The Respondent Unions there
2 included a Construction Trades Council and affiliated locals,
including Painters, Laborers, Carpenters, Plumbers, Sheet Metal
Workers, Iron Workers, and Electrical Workers. Also Re-
spondent was a Bricklayers Local. The Respondent Unions
13. Building Material & Construction Teamsters Union Local No.
. 216 (Bigge Drayage Co.), 198 NLRB No. 130, and General Team-
; sters Local 386 (Constriiction Materials Trucking, Inc.), 198 NLRB
No. 129, cited on appeal for the proposition that such agreements
. are secondary in nature and therefore illegal, are not in point because
7 they do not relate to on-site work.
14. The Board in footnote 11 of its decision stated:
“Neither the General Counsel nor the Charging Party disputes
the proviso’s application to the clauses in question. Accordingly,
there being no issue before us as to the validity of such clauses,
we assume, for purposes of this case, that they are within the
proviso and lawful,
There is no indication, however, that this reservation had any rela-
2 tionship to the factors argues for by the Charging Party in the instant
case. (See discussion of Colson and Stevens below.) Rather. it ap-
pears that the reservation is related to “sclf-help” issues decided
shortly thereafter by the Board in Muskegon, 152 NLRB 360, since
_ the clauses in Centlivre did contain “self- help” provisions. See
Centlivre, supra, at p. 861.
Piiaoite teins
Al3 *
sought from Centlivre, a general contractor, the “secondary”
clauses set forth on p. 861 of the Board decision. These agree-
ments would have required of Centlivre that ~nly signatories to
a contract with Respondent Unions would be permitted to work
on the construction site.’” As set out in the Trial Examiner's
decision: '”
“As general contractor, Centlivre itself employed 6 to 9
laborers, carpenters, and cement finishers. It subcontracted
particular craft operations to various firms in the Ft.
Wayne area.”
Centlivre had no collective-bargaining contract or relationship
with the Respondent Unions. And since Centlivre employed only
laborers, carpenters and cement finishers, the subcontracting
agreement restrictions would have applied to work of a kind
' Centlivre’s own employees did not perform. Thus it is entirely
clear that the elements contended for by the Charging Parties
in the instant cases as determinative for the validity of an on-site
agreement under the construction industry proviso were absent
in Centlivre and the Board, nevertheless, treated the clauses as
within the construction industry proviso.
Significant too is the fact that in Colson and Stevens itself
(where the facts were very like those in the instant case) the
factors the Charging Parties here contend to be preconditions
to proviso validity did not exist. That is, Colson had no col-
lective-bargaining agreement or relationship with the Unions
there involved and -the subcontracting agreement sought covered
work which employees of Colson did not perform. Thus the
Unions there (Carpenters and Laborers) sought to compel
Colson to grant recognition covering carpenters whom he did
employ. But the Unions also sought an agreement with secondary
subcontracting restrictions concerning any work Colson sub-
contracted and not confined to carpentry work.'’ The Board,
based on its pre-Centlivre view that only voluntary agreements
15. Supra, p. 856 and fn. 13.
16. Supra, p. 859.
17. See Colson, supra, at p. 1650 and 1651, and fn. 1.
%
)
i
SENET RI SR rnp ree
or eee
Al4
were within the construction industry proviso to Section 8(e),
found a violation on that basis. There is no scintilla of sugges- -
tion in the Board's decision that, had the subcontracting agree-
ment sought by the Unions been “voluntarily” entered into, the
Board might nevertheless have viewed the agreement as out-
side the construction industry proviso. So the underlying relevant
facts of Colson and Stevens, just as in Centlivre, are at odds
with the contentions of the Charging Parties here.
The Board’s holding in Church’s Fried Chicken, 183 NLRB
No. 102, on the facts there, is also directly contrary to the con-
tentions of the Charging Parties. While finding a violation of
Section 8(b)(7)(C) of the Act, the Board, upon exceptions
filed, affirmed the dismissal of the 8(b) (4) (A) and «B) al-
legations of the complaint. This was based on the Trial Ex-
aminer’s full discussion of the Section 8(b) (4) issues. Thus the
Trial Examiner pointed out that a violation of Section
8(b)(4)(A) would require a finding that the Union was at-
tempting to have Church sign an agreement violative of Sec-
tion 8(c). And this entailed a determination whether Church
was “an employer in the construction industry.” Upon con-
cluding, after discussion of the legislative history, that Church
was Such an employer, the Trial Examiner found that the agree-
ment which the Union sought would not have been violative of
Section 8(e) because of the construction industry proviso, and in
consequence, no violation of 8(b)(4)(A) could be found. As _
pointed out by the Trial Examiner “Church, instead of employ- }
ing a general contractor, acted as its own prime contractor :
through . . . its construction superintendent.” \It is clear that
Church had no collective-bargaining agreement or collective-
bargaining relationship with the Respondent Building Trades
Council, nor did Church directly employ employees of. the
crafts which might be represented by affiliates of the Respondent
Building Trades Council.’* The holding in Church’s Fried
Chicken then also negates the Charging Party’s contention.
18. With the possible exception of a laborer. See p. 3 of Trial
Examiner's Decision.
Al5
The Board’s post-Centlivre decisions giving broad scope to
the proviso also militate against the Charging Parties arguments.
Thus in Muskegon, 152 NLRB 360, the Board considered the
validity under Section 8(e) of the following: clause:
“It is agreed that the members of Bricklayers Local Union
No. 5 may refuse to work on any job where any of the
work, irrespective of craft, is performed, has been per-
formed, or is to be performed by craftsmen who enjoy
less favorable wages and working conditions than is pro-
vided in the current collective-bargaining agreement be-
tween the equivalent Muskegon County Building Trades
Local Union and its contracting employers. Such refusal
shall not be grounds for discharge or other disciplinary
action, but shall be regarded as a failure of the employer
to provide suitable work.” (Emphasis supplied.)
As emphasized in the Board decision itself, the clause per-
mitted a strike by members of the Bricklayers Union where
any of the work irrespective of craft, is, has, or is to be
performed by craftsmen who enjoy less favorable wages and
working conditions than is provided in the current collective-
bargaining agreement between the equivalent Building Trades
Union and its contracting employers. The Board, in a detailed
discussion, held the clause to be within the ambit of Section
8(e) and beyond the construction industry exemption solely
because of the self-help feature which the clause contained.'®
Thus the agreement between the Bricklayers and Muskegon,
«apart from its “self-help” features, was viewed as valid under
the proviso, though it was applicable “irrespective of craft” and
was conditioned on the “wages and working conditions . . . in
the collective bargaining agreement between the equivalent . . .
Locai Union and its contracting employers.”
19. This is made clear in the decision itself and, particularly
footnote 13, where the Board rejected the General Counsel’s con-
tention based on Colson and Stevens, 137 NLRB 1650. The Board,
citing Cenilivre, noted that it had:
“recently reversed Colson and Stevens and now holds that picket-
ing to obiain a contract clavse which is within the construction
industry proviso to Section 8(e) does not violate Section 8(b)
(4) (A).
a a |
PO i
seri Mea teeny
Al6
Then in Carvel, 152 NLRB 1672, the Board considered the
validity of the following clause:
“The Employer [Carvel] agrees that no journeyman or
apprentice who is a member of Local 217. . . will be
assigned to work or expected to work or required to work,
on any job or project on which a worker or person, is
performing any work within the jurisdiction of Local No.
217, if said worker or person is performing such work for
wages, hours or under any conditions of employment,
which are different from those established by this agree-
ment.” (Emphasis supplied. )
While again finding, as in Muskegon, that the clause was
unprivileged because of its “self enforcement provisions”, the
Board clearly viewed the clause as otherwise within the construc-
tion industry exemption. The Board specifically rejected the
contention there made that the proviso was inapplicable be-
cause the contract provision did not refer to the “contracting
out” or “subcontracting” of unit work and affected persons and
employers with whom Carvel had no contractual relationship.”
The Board stated: .
“. , . the application of the proviso does not, in our view,
dependfon the precise relationship between Carvel with
whom the Union has a contract and other employers and
persons on the job, in this instance the general contractor
and Ballard, who may be affected by the enforcement of
the contractual proviso. The language of the proviso itself
does not limit its applicability to the ‘contracting out’ or _
‘subcontracting’ of work by the employer with whom a
union has an agreement within the scope of Section 8(e).
Indeed, were the proviso given such a limited applicability,
it would be of little effect, for aside from the general con-
tractor on a job, the various firms involved normally have
control only of ‘unit’ work—that is, the particular work
for which they hold a subcontract. Restrictions on the
right to subcontract such work could well be primary, and
thus lawful without reference to the construction industry
proviso, because they are wholly outside the scope of
~8(e).” (At p. 1676.)
20. At p. 1677 and fn. 8.
Al7
Thhe Board decision in Ets-Hokin, 154 NLRB 839, followed
as rexcently as Baltimore Contractors, 190 NLRB 415, also re-
flect the breadth given to the construction industry proviso ex-
cept where “self-help” provisions are included in the agreement.
In Eits-Hokin, the clause at issue provided:
“The Local Unions are part of the International Brother-
hood of Electrical Workers and any violation or annul-
ment of working rules or agreements of any other Local
Union of the IBEW, or the subletting, assigning, or transfer
of any work in connection with electrical work to any
person, firm or corporation not recognizing the IBEW as
the collective-bargaining representative on any electrical
work in the jurisdiction of this or any other such Local
Union by the Employer, will be sufficient cause for the
cancellation of this agreement, after the facts have been
determined by the International Office of the Union.
Tlhe Board in Ets-Hokin and in subsequent cases collected
in Btaltimore Contractors, supra, treated such a clause as within
the «construction industry proviso.
Thus, the Board decisions since Centlivre have either held
or viewed the construction industry proviso as privileging what
may, be characterized as Denver Building on-site agreements
despite the absence of the factors which the Charging Parties
heres contend are required conditions of proviso exemption,
whesre the facts were not at odds with those of the Charging
Partties’ cases. And the full scope given to the proviso in such
decijsions points directly away from the Charging Parties’ con-
tenttions.
Aknd if, as the Board has held in cases discussed above, the
exeimption applies where the “agreeing” employer has no em-
ployees of the kind or craft involved,?" there is no reason to
2(0a. As a matter of fact the Board has held, with court approval,
that: a “person” can violate 8(e) by entering into a proscribed agree-
memt with a labor organization /nternational Association of Machinists
& Ajerospace Workers, AFL-CIO (Lufthansa German Airlines), 197
NLIRB No. 18, enfd. 85 LRRM 2257 (C.A. 9 January 9, 1974).
Thus, if a person who employs no one can violate 8(e) it would be
m4
FE RO SRILE TN REE ON a LSE |
Pegs
Als
attach significance to whether the agreement is in a “collective-
bargaining contract” or whether there is a “collective-bargain-
ing relationship” between the union and employer (for instance,
the general contractor) party to the agreement. Since any such
“collective bargaining contract” would not fix general terms
and conditions of employment for any of the employer’s own
employees, no independent significance appears with respect to
this contention of the Charging Parties.
The Court decision in Connell, supra, involving issues under
the anti-trust laws, has also been carefully and fully considered
in light of the foregoing discussion based on cases arising un-
der the Act itself. With the fullest respect to the Court, we see
no basis for relying on the dictum of the majority view and the
discussion in the minority opinion of Connell which would
warrant rejection of the foregoing discussion and analysis. Thus
the Court in Connell was apparently of the view that the ab-
sence of a “collective bargaining relationship” would preclude
a finding that the construction industry exemption to Section
8(e¢) might operate. And the Court apparently believed that
this question has not been considered by the Board and Courts.
But these arguments*' (the absence of a representable class
of employees and its variant—the absence of a —collective-
bargaining relationship) are essentially indistinguishable from
those rejected by the Board and Courts in the past. Thus, in
addition to the above discussion, it should be noted that the
absence of an employment relationship theory was directly
axiomatic that such a person could enter into a privileged 8(e)
proviso agreement absent a showing that Congress intended the
proviso to be narrower in coverage than the prohibition to which it is
an exception.
21. The Charging Parties here argue that the fundamental repre-
sentation concepts and policies reflected in Section 9(a) and 8(b) (7),
when read in conjunction with the exception expressly created in 8(f),
are undermined by permitting picketing for subcontracting agreements
of employers who do not employ workers in the craft represented by
such unions. See footnote 6 above and the discussion below concern-
ing the “equities” position in‘the dissenting opinion of Connell.
Al9
before the Court in San Bernadino.” There, in supporting its
argument that the agreement sought had an unlawful secondary
effect, the Board offered the following analysis:
“In the context presented in this case, where the sub-
contractor clause is sought to be imposed upon a general
contractor for whom subcontracting is the »ormal mode
of carrying on his enterprise . . . the terms of Article I-F
and its uniform interpretation by the Union snow [that]
the clause amounts to a commitment by the signafory
employer to use only AFL-CIO subcontractors, and, ac-
cordingly, to boycott another employer for reasons not
strictly germane to the economic integrity of the principal
work: unit.
“Indeed, Article I-F limits the category of permitted sub-
contractors even in those crafts which, by hypothesis, the
signatory employer does not himself employ. The record
contains no evidence as to the number of [the prime con-
tractor’s] employees, if any, nor as to their craft or trade. -
But it is improbable that . . . a small contractor, actually
hires members of the entire range of trades represented in
home construction; even the largest general Contractors
tend to employ only presons in the basic trades, subcon-
tracting the specialty work. Article I-F, however, makes
no distinction according to whether or not a subcontractor
could be ‘competing’: with the signatory employer's own
employees. Thereby it reveals its purpose to cause a boy-
cott of ‘nonunion’ (i.e., non-AFL-CIO subcontractors.”
(Board brief in San Bernadino, pp. 41, 42, citations
omitted. Emphasis supplied.)
The D. C. Circuit Court was not persuaded, rejecting, sub
silento, the absence of a “collective-l yrgaining relationship”
between the picketing Council and picketed employer as a basis
for finding subcontracting agreesaents unprotected by the build-
_ing and construction proviso to 8(e).
And in Colson and Stevens,”* in the Ninth Circuit Court of
22. Bui ‘Ilding and | Construction Trades C. ouncil of San Bernadino
and Riverside Counties, et al. v. N.L.R.B., 328 F.2d 540 (D.C. C.A.,
1964).
23. Construction Production & Maintenance Laborers Union,
Local 383, AFL-CIO and United Brotherhood of Carpenters and
ee ae |
see ee
A20
Appeals, the Board relied upon the context of requirements
under Section 8(b)(3) and 8(d) of the Act. Thus, in describ-
ing the “secondary subcontractor clause” in issue, the Board
briefly characterized it as a “regulation of third party relation-
ship extrinsic to the employment relationship” and therefore as
involving a non-mandatory bargaining subject which the unions
could not strike to obtain (Board’s brief at p. 26).
With respect to the dissenting opinion in Connell, Judge Clark
presented two approaches to the Section 8(e) on-site proviso,
one based on equitable considerations and the other based on
his view of the legislative history.
The legislative history of the construction industry proviso
and its interpretation in cases arising under the Act is dealt
with at length earfier. It is not repeated here. As for the dis-
senting Judge’s views concerning “one shot” agreements and
the pattern of bargaining in the construction industry prior to
enactment of the 1959 amendments to the Act, the Board’s
brief in Colson and Stevens, supra, is enlightening. There, in
discussing the construction industry practice legitimized by the
proviso, the brief states:
“As was pointed out in a 1950 study of building trades
bargaining in the 12 counties of southern California, where
a master agreement establishing basic employment stand-
ards has been in effect since 1941 in which 19 building
trades unions participate together with the 10 building
trades councils and the major contractors’ associations,
‘for the well-established employers, it is also important
to have a floor under competitive labor costs.’ The struc-
ture of the industry, with. subcontracting a customary way
of doing business, leads.employers to favor subcontracting
clauses as a means of undergirding such a ‘floor.’ The
Southern California master labor agreement referred to
above contains such a clause, similar to the clause that
the petitioner Unions sought to force upon Colson, as a
result of which ‘any. subcontractor [of a signatory con-
Joiners of America, Local 1089, AFL-CIO v. N.L.R.B., (Colson and
Stevens Construction Co.), 323 F.2d 422 (C.A. 9, 1963).
A21
tractor] who attempts to depart from the established union
standards’ faces cancellation of his contracts and an im-
mediate loss of business.’ On the other hand, if the con-
tractor is unwilling in [these] circumstances to cancel the
contract, or if he lets a subcontract to one who refuses
to become bound by the master labor agreement, then the
signatory contractor faces suit by the unions for specific
performances with an interruption of work on his project
occasioned by a change of subcontractors, and perhaps a
damage suit by the ousted subcontractor. The bargaining
pattern, with these effects, Congress believed legitimate
and left lawful. . . .” (Board’s Colson and Stevens brief,
pp. 19-21.)
This is particularly significant when it is realized that organ-
izing in the building and construction industry both prior to
and subsequent to the 1959 amendments, was and is primarily
carried on by building and construction trades councils on be-
half of their constituent craft locals. The building trades agree-
ments proffered are not conventional collective-bargaining
agreements, nor is a conventional collective-bargaining rela-
tionship sought, but rather an attempt is made to obtain skeleton
agreements (containing little more than subcontracting provi-
sions) which in turn are augmented by the execution of collec-
tive-bargaining agreements by the individual trade unions, the
latter agreements containing provisions governing wages and
other substantive conditions of employment. As the Court ob-
served in Dallas Building and Construction Trades Council v.
N.L.R.B., 396 F. 2d 677 (C.A. D.C.), at p. 682:
“. . . Congress intended by means of Section 8(e) to pre-
serve the Status quo of bargaining in the construction in-
dustry; and in 1959 ‘umbrella’ agreements like the one
proposed here were, as they are today, commonplace, for
collective-bargaining is traditionally conducted at several
levels in the construction industry. .. .”
24. The text of a typical building and construction trades coun-
cil agreement is set forth in detail in Dallas Building and Construction
Trades Council, 164 NLRB 9339. fn. 2 at p. 940.
A22
Under this arrangement the building and trades council is
as much as a “stranger” to the general contractor and his em-
ployees, if any, as the Plumbers Union was to Connell. The
subcontracting clause encased in such a trades council “shell”
agreement can no more be said to be obtained in the context
of a collective-bargaining relationship than the proviso agree-
ment sought or obtained in such cases as Colson and Stevens,
supra, Centlivre, supra, and Church’s Fried Chicken, supra.
As for the “equities” raised in the dissenting opinion, they
have been substantially dealt with by the Board and Courts in
cases under Section 8(b)(7) of the Act. Thus, the Board and
Court in Dallas General, supra, have pointed out the absence
of any inconsistency between ‘the Board’s interpretation of Sec-
tion 8(b)(4) and the purposes of Section 8(e). The Court in
Dallas General pointed out that “Sections 8(b)(7) and 8(e)
are aimed at wholly different problems.” Thus, the cases make
- clear that while considerations involving Section 9(a) selection
of a bargaining representative may be directly related to Section
8(b)(7) of the Act,” such considerations are unrelated to
“secondary” agreement issues under Section 8(e).
In view of all the foregoing, including Supreme Court and
Circuit Court decisions, relevant legislative history and the
Board’s post-Centlivre decision, we find the contentions of the
Charging Parties to provide no basis to establish under current
Board law, violations of either Section 8(e) or 8(b)(4) (A)
of the Act.
/s/ PETER G. NASH
Peter G. Nash
General Counsel
25. See, e.g., in addition to Dallas General, supra, Lane-Coos-
Curryv-Douglas Counties Building and Construction Trades Council,
AFL-CIO, 168 NLRB 538, enf. 415 F.2d 656 (C.A. 9); Los Angeles
Building and Construction Trades Council, et al. (Lively Construc-
tion Co.), 170 NLRB 1499; Church’s Fried Chicken, supra; and
Construction Trades Council of Philadelphia and Vicinity (Samuel
E. Long, Inc.), 201 NLRB No. 42, enfd. 485 F.2d 680 (C.A. 3,
1973).
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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.