Allied Chemical & Alkali Workers of America, Local Union No. 1 v. Pittsburgh Plate Glass Company, Chemical Division

PETITIONER: Allied Chemical & Alkali Workers of America, Local Union No. 1
RESPONDENT: Pittsburgh Plate Glass Company, Chemical Division
LOCATION: Christian County, Kentucky

DOCKET NO.: 70-32
DECIDED BY: Burger Court (1971-1972)
LOWER COURT: United States Court of Appeals for the Sixth Circuit

CITATION: 404 US 157 (1971)
ARGUED: Oct 20, 1971
DECIDED: Dec 08, 1971

ADVOCATES:
Guy Farmer - for respondents
Mortimer Riemer - for petitioner Allied Chemical & Alkali Workers of America, Local Union No. 1
Norton J. Come - for petitioner National Labor Relations Board

Facts of the case

Question

Media for Allied Chemical & Alkali Workers of America, Local Union No. 1 v. Pittsburgh Plate Glass Company, Chemical Division

Audio Transcription for Oral Argument - October 20, 1971 in Allied Chemical & Alkali Workers of America, Local Union No. 1 v. Pittsburgh Plate Glass Company, Chemical Division

Warren E. Burger:

We'll hear arguments next in number 32 and 39, Allied Chemical Workers versus Pittsburgh Plate Glass and the Labor Board against Pittsburgh Plate Glass.

Mr. Come you may proceed whenever you are ready.

Norton J. Come:

Mr. Chief Justice and may it please the Court.

This case is here on certiorari to the United States Court of Appeals for the Sixth Circuit which denied enforcement of the board's bargaining order.

The question presented is whether an employer violates his bargaining obligation under the National Labor Relations Act by refusing to bargain with the Union representative of his employees about the changes in health benefits which the employer proposes to negotiate with employees who have already retired.

Now the basic facts are these.

Since 1949, local one of the Allied Chemical Workers of America has been the bargaining representative for all hourly employees at the Barberton, Ohio plant of the Pittsburgh Plate Glass Company.

In 1950, the Union and the company negotiated a contract which for the first time included provisions for pension and hospitalization and surgical insurance plan.

At the same time the parties orally agreed that the employees who retired could participate in the medical plan by contributing the entire cost of the insurance premium which would be deducted from their pensions.

In 1959, retiree benefits under the plan were improved and as a result of contract negotiations 1962, the medical insurance plan became contributory for the first time.

The company agreeing to two dollars towards the cost of insurance premiums for employees who retired in future.

This was available to both the retiree and spouse.

At the same time a change was made in the pension plan to make 65 the mandatory retirement age.

A new contract was negotiated in 1964 and that forms the basis for this case.

At that time the company agreed to increase its monthly contribution of medical insurance from two dollars to four dollars.

The increase was made available not only to employees who retired after the effective date of the contract, but also to each participating employer or employee in the health plan, who had retired on or after the effective date of the 1962 contract, in other words it went back indefinitely to reach employees who had already retired.

In anticipation of the enactment of Medicare, however, the agreement further provided that the company could rescind the two-dollar increase in its contribution, if a government health program were enacted.

Now, Congress enacted Medicare on July 30, 1965.

This contract as I said was negotiated in 1964 and by its terms it had until October of 1967, before it would terminate.

In November of 1965, the Union asked the company to engaged in bargaining for the purpose of negotiating insurance benefits not covered by Medicare.

The company responded several months later by stating that the because of enactment of Medicare it intended to rescind the two-dollar extra contribution that it was making to the health insurance plan and it intended as a matter of fact to cancel the medical insurance plan for retirees entirely because the enactment of Medicare would render the company insurance plan useless.

Instead the company said that it would pay the three-dollars per month subscription cost of supplemental Medicare for each retired employee who elected that and decided to leave the company plan.

The Union conceded that under the contract, the Company by virtue of its reservation had the right to reduce its contribution to the health and welfare plan from four dollars to two dollars.

However, the Union vigorously protested the company’s further action in canceling the company plan all together.

And the Union further inquired what provision did the company intend to make for those pensioners and their wives who are under 65 and not eligible for Medicare at all.

The company challenged the Union’s right to bargain about retirees and acknowledged that there was a problem about the pensioner who would not -- or were not eligible for 65 and said that they have to think about that.

Several days later, the company informed the Union that it would not cancel the medical plan for retired employees.

Instead it would write each retiree notifying of the pendency of Medicare and indicating that it would give it the option for either remaining under the company plan with reduced contribution of two-dollars on the part of the company or getting out of the company plan in which case the company would pay the three-dollars supplemental Medicare subscriptions.

The Union objected on the ground that such change should be the matter of negotiations and could not be done unilaterally by the company.

The company took the position, the reiterated position and said we will not apply the matter and went ahead and bid to contact the retirees individually about the offer.