Nlrb v. Savair Mfg. Co., 414 U.S. 270 (1973)

MR. JUSTICE DOUGLAS delivered the opinion of the Court.

The National Labor Relations Board, acting pursuant to § 9(c) of the National Labor Relations Act, as amended, 61 Stat. 144,{1} 129 U.S.C. § 159(c), conducted an election by secret ballot among the production and maintenance employees of respondent at the request of the Mechanics Educational Society of America (hereafter Union). Under the Act,{2} the Union, if it wins the election, becomes "the exclusive representative of all the employees" in that particular unit for purposes of collective bargaining. The Union won the election by a vote of 22-20.

Respondent filed objections to the election, but, after an evidentiary hearing, a hearing officer found against respondent and the Board certified the Union as the representative of the employees in that unit. Respondent. however, refused to bargain. The Union thereupon filed an unfair labor practice charge with the General Counsel, who issued a complaint alleging that respondent had violated §§ 8(a)(1) and (5) of the Act.{3} The Board sustained the allegations and ordered respondent to bargain with the Union. 194 N.L.R.B. 298. The Court of Appeals denied enforcement of the order. 470 F.2d 305. We granted the petition for certiorari, 411 U.S. 964, there apparently being a conflict between this decision in the Sixth Circuit and a decision in the Eighth Circuit, NLRB v. DIT-MCO, Inc., 428 F.2d 775, and also with one in the Ninth Circuit, NLRB v. G. K. Turner Associates, 457 F.2d 484. We affirm.

It appeared that, prior to the election, "recognition slips" were circulated among employees. An employee who signed the slip before the election{4} became a member of the Union and would not have to pay what at times was called an "initiation fee" and at times a "fine." If the Union was voted in, those who had not signed a recognition slip would have to pay.

The actual solicitation of signatures on the "recognition slips" was not done by Union officials. Union officials, however, explained to employees at meetings that those who signed the slips would not be required to pay an initiation fee, while those who did not would have to pay. Those officials also picked out some five employees to do the soliciting, and authorized them to explain the Union’s initiation fee policy. Those solicited were told that there would be no initiation fee charged those who signed the slip before the election. Under the bylaws of the Union, an initiation fee apparently was not to be higher than $10, but the employees who testified at the hearing (1) did not know how large the fee would be and (2) said that their understanding was that the fee was a "fine" or "assessment."

One employee, Donald Bridgeman, testified that he signed the slip to avoid paying the "fine" if the Union won. He got the message directly from an employee picked by the Union to solicit signatures on the "slips." So did Thomas Rice, another employee.

The Board originally took the position that pre-election solicitation of memberships by a union with a promise to waive the initiation fee of the union was not consistent with a fair and free choice of bargaining representatives. Lobue Bros., 109 N.L.R.B. 1182. Later in DIT-MCO, Inc., 163 N.L.R.B. 1019, the Board explained its changed position as follows:

We shall assume, arguendo, that employees who sign cards when offered a waiver of initiation fees do so solely because no cost is thus involved; that they, in fact, do not at that point really want the union to be their bargaining representative. The error of the Lobue premise can be readily seen upon a review of the consequences of such employees casting votes for or against union representation. Initially, it is obvious that employees who have received or been promised free memberships will not be required to pay an initiation fee, whatever the outcome of the vote. If the union wins the election, there is, by postulate, no obligation; and if the union loses, there is still no obligation, because compulsion to pay an initiation fee arises under the Act only when a union becomes the employees’ representative and negotiates a valid union security agreement. Thus, whatever kindly feeling toward the union may be generated by the cost-reduction offer, when consideration is given only to the question of initiation fees, it is completely illogical to characterize as improper inducement or coercion to vote "Yes" a waiver of something that can be avoided simply by voting "No."

The illogic of Lobue does not become any more logical when other consequences of a vote for representation are considered. Thus, employees know that, if a majority vote for the union, it will be their exclusive representative, and, provided a valid union security provision is negotiated, they will be obliged to pay dues as a condition of employment. Thus, viewed solely as a financial matter, a "no" vote will help to avoid any subsequent obligations, a "yes" may well help to incur such obligations. In these circumstances, an employee who did not want the union to represent him would hardly be likely to vote for the union just because there would be no initial cost involved in obtaining membership. Since an election resulting in the union’s defeat would entail not only no initial cost, but also insure that no dues would have to be paid as a condition of employment, the financial inducement, if a factor at all, would be in the direction of a vote against the union, rather than for it.

Id. at 1021-1022.

We are asked to respect the expertise of the Board on this issue, giving it leeway to alter or modify its policy in light of its ongoing experience with the problem. The difficulty is not in that principle, but with the standards to govern the conduct of elections under § 9(c)(1)(A). We said in NLRB v. Tower Co., 329 U.S. 324, 330, that the duty of the Board was to establish "the procedure and safeguards necessary to insure the fair and free choice of bargaining representatives by employees."

It is, of course, true, as we said in NLRB v. Wyman-Gordon Co., 394 U.S. 759, 767, that "Congress granted the Board a wide discretion to ensure the fair and free choice of bargaining representatives." See also NLRB v. Waterman S.S. Co., 309 U.S. 206, 226. But in this case, two opposed groups are in contention: one composed of those who want a union, and the other of those who prefer not to have one. The Board in its DIT-MCO opinion says "it is completely illogical to characterize as improper inducement or coercion" a waiver of initiation fees for those who vote "yes" when the whole problem can be avoided by voting "no." 163 N.L.R.B. at 1021-1022. But the Board’s analysis ignores the realities of the situation.

Whatever his true intentions, an employee who signs a recognition slip prior to an election is indicating to other workers that he supports the union. His outward manifestation of support must often serve as a useful campaign tool in the union’s hands to convince other employees to vote for the union, if only because many employees respect their coworkers’ views on the unionization issue. By permitting the union to offer to waive an initiation fee for those employees signing a recognition slip prior to the election, the Board allows the union to buy endorsements and paint a false portrait of employee support during its election campaign.

That influence may well have been felt here for, as noted,{5} there were 28 who signed up with the Union before the election petition was filed with the Board, and either seven or eight more who signed up before the election. We do not believe that the statutory policy of fair elections prescribed in the Tower case permits endorsements, whether for or against the union, to be bought and sold in this fashion.

In addition, while it is correct that the employee who signs a recognition slip is not legally bound to vote for the union and has not promised to do so in any formal sense, certainly there may be some employees who would feel obliged to carry through on their stated intention to support the union. And on the facts of this case, the change of just one vote would have resulted in a 21-21 election, rather than a 22-20 election.

Any procedure requiring a "fair" election must honor the right of those who oppose a union, as well as those who favor it. The Act is wholly neutral when it comes to that basic choice. By § 7 of the Act, employees have the right not only to "form, join, or assist" unions, but also the right "to refrain from any or all of such activities." 29 U.S.C. § 157. An employer who promises to increase the fringe benefits by $10 for each employee who votes against the union, if the union loses the election, would cross the forbidden line under our decisions. See NLRB v. Exchange Parts Co., 375 U.S. 405. The right of employees to "form, join, or assist" labor unions guaranteed by § 7 has an express sanction in § 8(a)(1), which makes it an unfair labor practice for an employer "to interfere with, restrain, or coerce employees" in the exercise of those rights. 29 U.S.C. § § 157, 158(a)(1). Such interference is an unfair labor practice, as we held in NLRB v. Exchange Parts Co., supra. But, as already noted, § 7 guarantees the right of employees "to refrain from any or all of such activities."

Congress has also listed in § 8(b) of the Act "unfair" labor practices of unions. 29 U.S.C. § 158(b). There is no explicit provision which makes "interference" by a union with the right of an employee to "refrain" from union activities an unfair labor practice.

Section 8(c), however, provides:

The expressing of any views, argument, or opinion, or the dissemination thereof, whether, in written, printed, graphic, or visual form, shall not constitute or be evidence of an unfair labor practice under any of the provisions of this subchapter if such expression contains no threatof reprisal or force or promise of benefit.

29 U.S.C. § 158(c) (emphasis added).

Whether it would be an "unfair" labor practice for a union to promise a special benefit to those who sign up for a union seems not to have been squarely resolved.{6} The right of a free choice is, however, inherent in the principles reflected in § 9(c)(1)(A).

When the dissent says that "[t]he special inducement is to sign the card, not to vote for the union," and that treating the two choices as one is untenable, it overlooks cases like NLRB v. Gissel Packing Co., 395 U.S. 575. There, we held that the gathering of authorization cards from a majority of the employees in the bargaining unit may entitle the union to represent the employees for collective bargaining purposes, even though there has been and will be no election, id. at 582-583, and that rejection of that authorization by the employer is an unfair labor practice. Where the solicitation of cards is represented as being solely for the purpose of obtaining an election, a contrary result is indicated. Id. at 584, 606. Thus, the solicitation of authorization cards may serve one of two ends. Of course, when an election is contemplated, an employee does not become a member of the union merely by signing a card. But, prior to the election, if the union receives overwhelming support, the pro-union group may decide to treat the union authorization cards as authorizing it to conduct collective bargaining without an election. The latent potential of that alternative use of authorization cards cautions us to treat the solicitation of authorization cards in exchange for consideration of fringe benefits granted by the union as a separate step protected by the same kind of moral standard that governs elections themselves.

The Board, in its supervision of union elections, may not sanction procedures that cast their weight for the choice of a union and against a nonunion shop or for a nonunion shop and against a union.

In the Exchange Parts case, we said that, although the benefits granted by the employer were permanent and unconditional, employees were

not likely to miss the inference that the source of benefits now conferred is also the source from which future benefits must flow and which may dry up if it is not obliged.

375 U.S. at 409. If we respect, as we must, the statutory right of employees to resist efforts to unionize a plant, we cannot assume that unions exercising powers are wholly benign towards their antagonists, whether they be nonunion protagonists or the employer. The failure to sign a recognition slip may well seem ominous to nonunionists who fear that, if they do not sign, they will face a wrathful union regime should the union win. That influence may well have had a decisive impact in this case, where a change of one vote would have changed the result.

Affirmed.

1. Section 9(c)(1)(A) provides in part:

(c)(1) Whenever a petition shall have been filed, in accordance with such regulations as may be prescribed by the Board --

(A) by an employee or group of employees or any individual or labor organization acting in their behalf alleging that a substantial number of employees (i) wish to be represented for collective bargaining and that their employer declines to recognize their representative as the representative defined in [§ 9(a)] . . .

* * * *

the Board shall investigate such petition and if it has reasonable cause to believe that a question of representation affecting commerce exists shall provide for an appropriate hearing upon due notice. . . . If the Board finds upon the record of such hearing that such a question of representation exists, it shall direct an election by secret ballot and shall certify the results thereof.

29 U.S.C. § 159(c).

2. Section 9(a) provides:

Representatives designated or selected for the purposes of collective bargaining by the majority of the employees in a unit appropriate for such purposes shall be the exclusive representatives of all the employees in such unit for the purposes of collective bargaining in respect to rates of pay, wages, hours of employment, or other conditions of employment. . . .

29 U.S.C. § 159(a).

3. Sections 8(a)(1) and (5) provide:

(a) It shall be an unfair labor practice for an employer --

(1) to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in [§ 7];

* * * *

(5) to refuse to bargain collectively with the representatives of his employees, subject to the provisions of section [9(a)].

29 U.S.C. §§ 158(a)(1) and (5).

4. The question for review presented by the Board is whether the

Board properly concluded that a union’s offer to waive initiation fees for all employees who sign union authorization cards before a Board representation election, if the union wins the election, does not tend to interfere with employee free choice in the election.

(Emphasis added.) There was testimony by Alfred Smith, National Secretary-Treasurer of the Union, that he told the employees at a meeting that the waiver of initiation fees was open to all who signed the authorization cards before the collective bargaining contract was signed.

The Hearing Officer, however, found that

Bridgeman further testified that subsequent to that meeting, and prior to the election, Bennie McKnight told employees that, if they signed the union membership and authorization card before the election, there would be no union "initiation fee" if the union were successful at the election.

(Emphasis added.) While Bridgeman’s testimony about McKnight’s representations after the meeting might have been only implicit, the Hearing Officer also referred to Bridgeman’s testimony that Smith himself had stated at the meeting that waiver of the initiation fee would be limited to those signing up before the election. The Hearing Officer clearly proceeded on the premise that the waiver was open only to those who signed up before the election:

The Employer further argues that it is an economic inducement contingent upon how employees vote in the election and on the results of the election, and, as such, constitutes an objectionable inducement. This argument, however, has been rejected by the Board. In the DIT-MCO, Inc., 163 N.L.R.B. No. 147 case [p. 1019], the Board held that a provisional waiver of initiation fees prior to election is not improper regardless of whether it is contingent upon the results of the election. The Board pointed out that it would be unreasonable to conclude that a statement by the union during an election to the effect that an assessment of money or an obligation to pay money which could be avoided by the execution of a union membership card prior to the election, would influence a vote in favor of the Union when the simplest way to avoid the incurrence of any financial obligation would be to vote "no." Thus, it would appear that any threat to impose a "fine," "assessment" or "initiation fee," or "payment to join the union," although it may induce an employee to execute a union authorization membership card, would more probably induce him to vote "no" at the election.

(Emphasis added.)

The Court of Appeals read the Hearing Officer’s Report to state that the waiver was limited to those signing up before the election, as do we. Such a reading is amply supported by the evidence in the record beyond the testimony to which we have already alluded. The record demonstrates the pressure which employees felt to sign up with the Union quickly, before the election and perhaps even before the representation petition itself was filed, a pressure utterly inconsistent with a belief that a waiver would be available to them up to the time a collective bargaining agreement was signed after the election. It is also supported by the fact that 28 individuals signed up with the Union before the election petition was filed with the Board on August 12, 1970, and apparently an additional seven or eight signed up before the September 22, 1970, election. But there is no indication of any individuals signing up with the Union after the election, which would be the obviously rational decision once the Union had won the election.

The Board argues that unions have a valid interest in waiving the initiation fee when the union has not yet been chosen as a bargaining representative, because

"[e]mployees otherwise sympathetic to the union might well have been reluctant to pay out money before the union had done anything for them. Waiver of the [initiation fees] would remove this artificial obstacle to their endorsement of the union."

See Amalgamated Clothing Workers v. NLRB, 345 F.2d 264, 268 (CA2 1969). While this union interest is legitimate, the Board’s argument ignores the fact that this interest can be preserved as well by waiver of initiation fees available not only to those who have signed up with the union before an election, but also to those who join after the election. The limitation imposed by the Union in this case -- to those joining before the election -- is necessary only because it serves the additional purpose of affecting the Union organizational campaign and the election.

5. Seen. 4, supra.

6. The lower courts have recognized that promising benefits or conferring benefits before representation elections may unduly influence the representational choices of employees where the offer is not across the board to all employees but, as here, only to those who sign up prior to the election. See, e.g., NLRB v. Gorbea, Perez & Morell, 328 F.2d 679, 681-682 and nn. 6-7 (CA1 1964) (promise to waive initiation fee for those joining union prior to election, but not after, may substantially influence election); Amalgamated Clothing Workers v. NLRB, 345 F.2d at 268-269 (Friendly, J., concurring) (improper to waive fees for those joining union immediately while indicating that this is foreclosed to those joining later). See also Collins & Aikman Corp. v. NLRB, 383 F.2d 722, 728-729 (CA4 1967) (paying employee $7 to be observer at election is an "unreasonable or excessive economic inducement" potentially influencing other employees, and is ground to set aside election); NLRB v. Commercial Letter, Inc., 455 F.2d 109 (CA8 1972) (disproportionate payments to employees attending union "hearings" prior to representation election).

The NLRB itself has recognized in other contexts that promising or conferring benefits may unduly influence representation elections. See e.g., Wagner Electric Corp., 167 N.L.R.B. 532, 533 (grant of life insurance policy to those who signed with union before representation election "subjects the donees to a constraint to vote for the donor union"); General Cable Corp., 170 N.L.R.B. 1682 ($5 gift to employees by union before election, even when not conditioned on outcome of election, was inducement to cast ballots favorable to union); Teletype Corp., 122 N.L.R.B. 1594 (payment of money by rival unions to those attending pre-election meetings).