American Ship Building Company v. National Labor Relations Board

PETITIONER:American Ship Building Company
RESPONDENT:National Labor Relations Board
LOCATION:United States Post Office and Courthouse

DOCKET NO.: 255
DECIDED BY: Warren Court (1962-1965)
LOWER COURT: United States Court of Appeals for the District of Columbia Circuit

CITATION: 380 US 300 (1965)
ARGUED: Jan 21, 1965
DECIDED: Mar 29, 1965

Facts of the case

Question

Audio Transcription for Oral Argument – January 21, 1965 in American Ship Building Company v. National Labor Relations Board

Earl Warren:

The American Ship Building Company, Petitioner, versus National Labor Relations Board.

Mr. Tyson you may argue your case.

William S. Tyson:

Mr. Chief Justice, may it please the Court.

This case involves a temporary layoff or lockout by the American Ship Building Company which occurred on August 11, 1961.

I would like to call the attention to a few of the salient facts with the Court’s permission.

The case was originally brought charging violations of Section 8 (a) (1), 8 (a) (3) and 8 (a) (5) of the Taft-Hartley Act and was brought against all of the shipyards which this company operates in Buffalo, New York, Toledo and Lorain, Ohio and Chicago, Illinois.

However, the Board dismissed the charge of failure to bargain on the 8 (a) (5) and held only with respect to the Chicago shipyard that there had been violations.

I’d like to call also to the attention —

This is a single employer.

William S. Tyson:

Right, yes sir.

This is a single employer layoff or lockout as compared with the one which you gentlemen heard yesterday involving the multiemployer lockout.

I’d like to call to the attention of the Court the fact that this was a three to two decision by the National Labor Relations Board and the Chairman of the Board, Chairman McCulloch wrote the minority opinion.

He was joined by a member Rogers in that opinion.

It was three to two indicating which is very close and then the case was appealed to the — or went to the Court of Appeals for the District of Columbia for enforcement.

The Court of Appeals held that the order should be enforced and on petition which we filed here, this Court has accepted the petition of the American Ship Building Company to hear the case on a limited bases on the question of whether or not the single employer lockout is the corollary of a strike under the Taft-Hart — under Section 8 (b) (4) of the Taft-Hartley Act.

William J. Brennan, Jr.:

We have no replacements prior the —

William S. Tyson:

No sir.

In — in December 1960, the American Ship Building Company knowing the depressed condition under which the industry on the Great Lakes had operated and knowing that they were a seasonal operation because the Great Lakes are frozen over from November through to April decided that they would like to have the new contract which expired on July 31, the old contract.

They just like to have that renewed with the least disturbance that would be possible.

So they had a meeting in December and suggested this to the unit organization which was they — there are eight craft unions here and the Boilermakers Local No. 374 in Chicago is the one that referred the charges.

Subsequently, the parties in May 1961 exchanged proposal for the new contract.

And on June 6, 1961, the first meeting of the parties was held.

At that meeting —

Earl Warren:

When was — when did the contract expired, Mr. Tyson?

William S. Tyson:

July 31, 1961.

At that meeting, the negotiator for the American Ship Building Company called attention to the depressed condition of the industry in the Great Lakes and mentioned the fact that the company was paying as much as 42 cents an hour more than its competitors.

In addition, the union negotiator stated that he didn’t want a strike.

Well both then said they didn’t want a strike.

Subsequent negotiations took place beginning — well all through June and then on July 6 the company suggested that the Federal Mediations Service to be called into the dispute and a conciliator was brought into the dispute of that day.

On July 31, agreement still had not been reached.

William S. Tyson:

And the company had been asked if they would agree to a six months extension of the contract or to an indefinite extension of the contract.

The company would not agree to that because they thought with the validity I think that that would enable stalling on the part of the negotiating unions to bring about a strike during their busy season when they would be most vulnerable to a strike effort by the union.

But they did agree to carry on while the union took a vote on their last proposal.

They also suggested, and this is not mentioned in the facts of the respondent’s brief, but they also offered the union a one year extension of the existing contract.

That I believe is at page 177 or 178 of the record.

In any event, the conciliator was sufficiently worried about precipitous strike action to ask that a communication be transmitted to a high official of the union in Washington to ask that no precipitous strike action be taken by the union.

As a result, and I believe that is at page 267 of the record, as a result on August the 2nd, this union official sent a telegram in which he assured that there would be no precipitous strike action until he had it arrived in Cleveland where the negotiation was taking place on August 7.

He did arrive on August 2nd, further meetings were held on August 8th and 9th and on August the 10th, no agreement having been reached, the union had refused to take back to its members for a vote, the last proposal made by the American Ship Building Company.

In view of all of those facts and an impasse having been reached in the bargaining, the company officials met on August 10 and decided that the only strategy that was available to them would be a layoff.

So notices were passed out and on the morning of August the 11th, this layoff took place in the Chicago shipyard.

Now, it is important to note and I typically call this to the Court’s attention that the record of bargaining in this situation was quite unusual.

This company during the previous ten years, beginning in 1962, had been faced with a strike and there had been a strike on each occasion that the contract expired.

In 1952, in 1953, in 1955, in 1956, in 1958, five strikes with five contracts.

William J. Brennan, Jr.:

Mr. Tyson, can you tell us what happened in the last contract expired on August 15, 1963?

William S. Tyson:

I was going to get to that, Your Honor.

I think that is quite significant, it’s not in the record but I’d like to mention if I could.

And then, in addition, if I may, there were two walkout strikes in February 1961 in Buffalo and Chicago.

And in 1955 if the Court pleases a large — a very large vessel was held in the shipyard during the strike because of a slow down which did not allow these repairs to be completed prior to this — to the layoff — to the strike.

Now, they were the conditions under which this company was offering.

They were the conditions it was faced with when this impasse was reached and I might point out that the trial examiner found that this lockout was justified.

He found that there was legitimate fear of a strike and the Board refused by three to two decisions to agree with them on that point.

Now, the Taft-Hartley Act of course was enacted to equalize the bargaining relationship between unions and employer.

Prior to the Wagner Act, the union side had been without proper protection.

So the Wagner Act came along in 1935 and did give in Section 7 and other sections did give protections to the unions in their striking and concerted activities.

Then in 1947 in view of the public mood, changes were made to more nearly equalize the bargaining relationship between the parties.

And I might mention that in the Wagner Act, there was no prohibition of a lockout, that’s pretty clear.

When the Taft-Hartley Act came along, there is still no prohibition of the lockout except within the 60-day period as mentioned in Section 8 (b) (4), the notice period which says during that period there should be no strike or lockout.

But in Taft-Hartley, the strike and the lockout are coupled in four sections.

And this Court in what I termed the Truck Drivers case which was really a decision of this Court in the Buffalo Linen case, this Court in that case with Mr. Justice Brennan speaking said that the mention of the strike and lockout in the same context there in those four sections constituted a recognition.

In the Taft-Hartley Act that lockouts were not in effect completely barred and they were not illegal per se.

William S. Tyson:

That we certainly agree with and we rely to a considerable degree on this Truck Drivers Local case.

In that case which I believe, I can’t remember but I believe it was six or seven or eight to — nothing I’m not sure of that number.

But I know it was pretty nearly unanimous.

And in that case, the Court also said that the protections provided by Section 7 and 13 of the Act for union activities they are not so absolute as to deny self help to employers when the legitimate interest of employers and employees collide, that gentlemen is the situation here.

They have collided.

And we contend that the legitimate interest of the American Ship Building Company need to be protected by this — needed to be protected by this layoff which took place on August 11.

And I might say in answer to the earlier question of Justice Goldberg that according to information that I have, there has been the best relationship between the unions and the company subsequent to this layoff which ended on October 27, 1961.

As a matter of fact I have been told that the relationship is now so good that instead of having five strikes in ten years that there’s just peace, peace between the two different — different bargaining parties and that I think is very wonderful.

But getting back to this situation here, the Truck Drivers Local case not only took the position that lockouts were not barred but they took a further position that the position of the Board legitimatizing an economic lockout was not a full extent of the power of the Act to permit lockout.

In other words, they indicated or at least we think the Court indicated that there were other lockouts that were permissible other than the economic lockout and of course in that case, the multiemployer lockout was permitted to protect the employer against whipsaw union tactics.

Now —

Potter Stewart:

The rationale of that case was — that that was permissible there to protect the bargaining unit, wasn’t it?

William S. Tyson:

Well, Mr. —

Potter Stewart:

And you don’t have that the — you don’t have that here in this case.

William S. Tyson:

Mr. Justice Stewart, I have an argument I want to make on — on this case —

Potter Stewart:

Right.

William S. Tyson:

— which I’d like to get in that for just one minute, if I may.

Potter Stewart:

I don’t want to interrupt you more —

William S. Tyson:

In any — in any event, the board if I may get back to this economic lockout business, the National Labor Relations Board, we think, without authorization from the statute and without real validity has attempted to characterized lockouts by terminology which we in effect thinks — think takes away from the employer legitimate right that she is entitled to under this Act.

Byron R. White:

Well, this is enticing as it’s your — or you make — are you taking two positions there, one that the lockout is generally an economic lockouts generally in any stages of the bargaining process is permissible weapon and tool and also that either that isn’t so there are special circumstances here which justified this particular lockout to protect the economic interest of the employer in this particular situation.

William S. Tyson:

I would say so, yes.

I would like —

Byron R. White:

You — you’re making both the broadest search and the narrow.

William S. Tyson:

I am making and I was going to get that.

Our position fundamentally and I wanted to get to that after I talk about the Insurance Agents’ case.

Our position fundamentally is that in collective bargaining, the Board has gone beyond the scope of the powers granted to it by the Congress.

We rely on the Insurance Agents’ case in that connection.

On the language of the Insurance Agents case —

Byron R. White:

You don’t suggest — you don’t suggest that it’s always been the rule of lockouts just generally permissible, do you?

William S. Tyson:

I suggest there’s no legal bar to a lockout taking place.

Byron R. White:

Would you know of any case that ever approved lockouts generally under the —

William S. Tyson:

Lockouts, generally.

I can’t because it has been raised —

Byron R. White:

But you’re asking us to make that kind of rule?

William S. Tyson:

Right.

As a matter of fact I’m asking you to do that all — all to find that this particular lockout as you said under circumstances here is legitimate

Arthur J. Goldberg:

Well, is that open under the grant of certiorari here.

I thought we had granted certiorari requesting to and your petition which is a broad question.

William S. Tyson:

Yes sir.

Arthur J. Goldberg:

And isn’t that why this case is here.

We’re not —

William S. Tyson:

That is correct.

Arthur J. Goldberg:

— here to consider whether under the particular facts of this case just to avoid a strike.

William S. Tyson:

Yes, that is correct.

However, in that context, I think the alternative answers are permitted.

And we think, as Mr. Justice White indicated, that actually the lockout is legitimate irrespective but we say that in the context of the facts here, we say that under Section 8 (b) (4) which is the limited question here that this particular lockout is legitimate because it meets the test which we think and are arguing to you are necessary to legitimatize a lockout.

Arthur J. Goldberg:

Now, Mr. Tyson, the Board itself recognizes in its decisions, a series of decision, that a lockout is permissible under their view of the statute to avoid extraordinary losses threatened by an imminent strike.

William S. Tyson:

Yes.

Arthur J. Goldberg:

And here there has been a factual determination by the Board confirmed by the Court of Appeals against you on that particular phase of case.

William S. Tyson:

On — on the economic phase —

Arthur J. Goldberg:

Yes.

William S. Tyson:

— economic laws.

Arthur J. Goldberg:

So really, I’ll go back to what I said, aren’t you under the grant here confined to your substantive argument?

William S. Tyson:

I don’t think so — I don’t think I’m confined as you, Mr. Justice Goldberg is saying.

I think that you can — that this Court can find that lockouts generally as Mr. Justice White said are not barred by the Taft-Hartley Act over any other Act.

But if you don’t want to go that far, I would say that the Insurance Agents’ case and the legislative history of the Act all of the factors indicate to me that a lockout where the employer goes in to bargain with the employee that he is not stopped from using economic pressure in the form of a lockout.

And that under the facts in this case that he is permitted to use that economic pressure under Section 8 (b) (4).

Now, I was getting earlier to the situation that the Board has by terminology we think to characterize lockouts in an unfair way.

They called them, Mr. Justice Goldberg the economic laws of lockout.

The multiemployer lockout to avoid whipsaw tactic and they called this one a bargaining lockout.

William S. Tyson:

Now, we don’t like to be placed in that pigeonhole but we are there at least they say we’re there and we think that a bargaining lockout is permissible of the Taft-Hartley Act.

Arthur J. Goldberg:

Are you saying that they’re not confined?

William S. Tyson:

We think that an employer when he goes to the bargaining table is not confined to defensive tactics while the union is able to engage in offensive tactics all the time.

We don’t think that’s fair.

We don’t think that Taft-Hartley Act meant to put that onus on an employer as a bargaining table.

Arthur J. Goldberg:

And what are those (Inaudible)

William S. Tyson:

Yes.

Arthur J. Goldberg:

You would say that this would not depend upon an impasse being reached in the negotiations.

William S. Tyson:

No, I didn’t say that sir.

I didn’t say that.

I think that when an impasse is reached, he is enabled offensively as well as the defensively to use the lockout as an economic pressure.

Arthur J. Goldberg:

What about — what is your view about before an impasse is reached?

William S. Tyson:

I —

Arthur J. Goldberg:

We got to say that because you said in formulating if you said, well he’s entitled to go to the bargaining table armed with this economic weapon.

William S. Tyson:

I believe, Mr. Justice Goldberg that I would without probably any legal reasons but just because of the mechanics of this thing, I think I would say that our position is after an impasse.

Potter Stewart:

You equate — you equate the employer’s rights to lockout with the employees’ rights to strike?

William S. Tyson:

That’s correct sir.

That is our argument here.

Potter Stewart:

Yes.

William S. Tyson:

Now —

William O. Douglas:

I understand that the advantage of that is argued upon passed upon impasse.

William S. Tyson:

Well —

William J. Brennan, Jr.:

Insurance Agents itself as I remember, no impasse is meet in that bargaining when the union resorted to facts that they’re characterized as legitimate.

William S. Tyson:

I — I can’t recall, I know that this is a characterization in the Board’s brief of the defensive multiemployer lock — lockout.

William J. Brennan, Jr.:

Well, I’m speaking of Insurance Agents.

William S. Tyson:

Insurance Agents.

William J. Brennan, Jr.:

In In — in Insurance Agents, I may be wrong in my facts.

My recollection is that bargaining had not reached an impasse when the union resorted to the tactics —

William S. Tyson:

Oh no!

I don’t think it had.

William S. Tyson:

I don’t think that —

William J. Brennan, Jr.:

Now, why do you say that if this is permissible that your position is it’s permissible on the part of the employer to use the lockout only impasse have been followed.

William S. Tyson:

Well, I think Mr. Justice Brennan and I am so thoroughly relying on the language of those cases which — in which you wrote the opinion and I may not be correct in exactly what you meant there but I am relying I believe on the views expressed in the Seventh Circuit and the Ninth Circuit on — on this impasse question.

In the Morand Brothers case and in those other cases as the Court will recall, there was always an impasse and I think that my reasons for reaching that conclusion based on the logic we might say or the Court, the Seventh Circuit and the other circuits.

William J. Brennan, Jr.:

And the facts here in any event I gather in the — on your facts here are that these were never heard after impasse.

William S. Tyson:

That was an impasse here, and of course that certainly colors my thinking.

But I’d like to point out again, if I may, that this characterization for the Board of these lockouts in various categories is not realistic.

For instance, the bargaining lockout, of course, is to advance the bargain for the employer to try to get him as good an employment contract as his passport.

Well, the Court in the Truck Drivers Local case at page 96 in speaking of the multiemployer lockout, if I may read the sentence, it says conflict may arise for example to clean the right strike and the interest of the small employers in preserving multiemployer bargaining as a means of bargaining on an equal basis with a large union and of — and avoiding the competitive disadvantage resulting from non-uniform contractual term.

Now, our point in reading that is just the Court in approving this multiemployer lockout recognized that the protection of this multiemployer bargaining unit which they considered so important by the small employer that that also gave the employer a competitive advantage over his competitors and in that sense, this falls within the economic realm, according to our view, and therefore, this Court we hope will not follow the Board’s action in trying to make all of these lockouts different to fit their theory because some of these lockouts that they call economic really advance the bargaining interest of the employer.

Take the Alaska Businessmen Association.

In that case it brings out a very vividly the difficulty of the position urged by the Board.

In that case, the association had a selective strike, the multiemployer bargaining organization that are like at a selective strike and there was a lockout at certain unstruck employer but the question there and they held that the lockout is illegal, the question there was whether or not they had advanced their bargain as well as having preserved the bargaining unit and they held that illegal.

And that shows you the difficulties of trying to separate these inseparable questions.

And for that reason, if the Court pleases, we argue very strongly that this nomenclature, this terminology that the Board is using is unauthorized, unwarranted and defeats the legitimate interest of an employer.

I believe I have five more minutes?

Earl Warren:

You may, Mr. Tyson.

Mr. Come.

Norton J. Come:

Mr. Chief Justice, may it please the Court.

At the outset, I should like to emphasize that as we view it, the second position that Mr. Tyson has urged is not before this Court.

On the findings of a majority of the Board which were sustained by the Court of Appeals, the company here at the time that it locked out or laid off its employees did not have any reasonable basis to anticipate a strike.

So this is not a case that sits within the so called economic necessity of Betts Cadillac line of case.

The dissent of Chairman McCulloch and the Board went simply to that factual issue.

He did not just reach the issue and as a matter of fact indicated that he was not reaching or deciding in a way different from the way the majority of the Board has decided.

The legal issue which is before the Court here namely whether or not a single employer has the right to use the lockout as an offensive weapon, in other words, to advance his bargaining position even though he is not faced with any or has no reasonable basis for anticipating that a strike will be called or that he is facing any unusual operating problem.

You might —

Potter Stewart:

Well, is it your – Mr. Come, is it your interpretation that just took place during the course of bargaining or after an impasse had been reached?

Norton J. Come:

I believe that the examiner found that an impasse had been reached and that finding was not disturbed by the Board, so that we do have an impasse in this case.

However, I think that the logic of Mr. Tyson’s argument affords to basis for impinging it to an impasse.

I think that it’s logically —

Potter Stewart:

Yes, but what you said was with that bargaining position as though this was during the bargaining before an impasse is reached —

Norton J. Come:

Well —

Potter Stewart:

I didn’t — I just wondered about the legitimate —

Norton J. Come:

Well, to — to get his contract terms rather than the terms that the union was demanding.

I might add here that the union here offered not indefinitely to extend the current contract which had a no-strike clause but they extended until a new agreement had been reached.

So there wasn’t anything indefinite about their offer here to forego a strike and as a matter of fact, they continued working at the Lorain yard which had worked in it well notwithstanding the fact that there had been a layoff at the — of the South Chicago yard which is the only yard that’s involved in this case.

Now, earning to the legal issue which we believe is here, we don’t — I submit think that it’s very helpful to try to answer it in terms of whether the lockout is the corollary of the — of the strike.

That really begs the question what we’re dealing with here are the provisions of the National Labor Relations Act and what we find there is that Section 7 and 13 of the Act specifically protect the right of employees to engage in concerted activities, collective bargaining and the right to strike.

Indeed, Section 13 says that the right to strike shall not be interfered with except insofar as the Act specifically provides otherwise.

As this Court recognized in the Buffalo Linen case, there is no specific protection for employer weapons where the lockout or any other economic weapon.

Potter Stewart:

Now, Mr. Come is this right or tell me if I’m wrong, that before any — before any National Labor legislation, there’s no question at all under the law of the employer’s right to lockout.

Norton J. Come:

For any reason.

Potter Stewart:

For any reason and there was considerable question about the employees’ right to strike for various legal reason.

And therefore that was a very good reason to expressly and specifically, explicitly protect the right to strike in the National Labor legislation that there was no reason at all to affirm a right that already existed that is the employer’s right to — employer’s right to lockout.

Norton J. Come:

But on the other hand, Your Honor, taking the promise that the employer could lockout for any reason, he could also lockout for the purpose of beating a union.

Now, there’s no question that under the Wagner Act and the Taft-Hartley Act, he can no longer do that.

Now, you don’t have a specific provision of the Act that deals with that problem in so many terms.

What you have is 8 (a) (1) which is phrased generally in terms of making it an unfair labor practice for an employer by interference, restraint and coercion to interfere with the employee’s organizational rights.

We submit, that Congress decidedly left that general so that the Board would on a case-by-case basis have the power to balance the legitimate interest of the employers against the impairment of employee rights involved and we submit that that is the way Congress left the question of how much of the lockout was to be left privileged to be sure the lockout as this Court recognized in Buffalo Linen is not completely prohibited.

But on the other hand nor is it completely permitted and the extent to which it is privileged, we submit, has been left to the Board subject to judicial review to be sure under the application of the balancing test under 8 (a) (1).

Potter Stewart:

Was there any discussion of this at all in the — to be found with the legislative history either Wagner Act or the Taft-Hartley Act or the legislation in 1959 the Labor Management Disclosure Act.

Norton J. Come:

The only that indicated discussion that I can find is a bit of the Wagner Act history which is referred to by the Court in our footnote in Buffalo Linen.

8 (a) (1) of the Wagner Act originally provided that it was an unfair labor practice for the employer to interfere, restraint, coerce, lockout, and in the draft as enacted, the word lockout was eliminated but I submit that that is not necessarily dispositive because even though it’s eliminated it clearly a violation of 8 (a) (1) to lockout for an anti-union purpose.

Arthur J. Goldberg:

We don’t have here, however, any anti-union purpose in the lockout.

Norton J. Come:

No Your Honor, you do not.

However, as this Court recognized in the Erie Resistor, there are some acts that’s so severely impinged upon protected employee activity that they may be made properly found to violate the Act even though there is not an anti-union purpose in invidious sense.

Arthur J. Goldberg:

Was the Erie Resistor you add, the employer resort to a device, the super-seniority for replacements for people who didn’t have to come and strike which really in the experience of industrial experience makes the final settlement very difficult.

There you don’t have it.

Norton J. Come:

Well, that is true.

However, I reread the Erie Resistor again in the light of that observation, Your Honor which you’ve pointed out in the Brown case and I find that although that was a factor, that was one of five factors that the Court enumerated as a justification for the Board’s position.

Norton J. Come:

And the other four factors went to the immediate impact of the super-seniority in terms of breaking up the strike.

Moreover, Buffalo Linen which recognized that this lockout problem is within the area of balancing didn’t draw the line in terms of whether it was merely a weapon that would expend itself after the economic contest or whether it went beyond.

I submit further that there’s nothing in the language of the statute which warrants that sort of a —

Arthur J. Goldberg:

Assuming that Mr. Come —

Norton J. Come:

Yes.

Arthur J. Goldberg:

— there is something about the spirit of statute that’s involved.

You’re dealing here with a pretty fundamental thing.

Norton J. Come:

Well, I would like —

Arthur J. Goldberg:

And I — I would like you for a moment that anytime in your argument, address yourself to the basic concept that whether you believe when the Congress adapted this statute which was designed primarily to prevent anti-union device, the Wagner operation.

It was never contemplated that economic weapons shouldn’t be pretty equal in terms of being used one against the other.

Short of what you have correctly pointed out that it was obviously the purpose of the statute to prevent to be used to destroy a union.

Norton J. Come:

Well, I think one of the basic purposes of the Act is this evident from the Section 1 was to equalize the bargaining power of employees and employers and the way that — one of the basic ways in which the Congress thought to do that was to protect the right of the employees to bargain collectively through representatives of their own choosing and to engage in a concerted activities from mutual aid and protection and as part of that panoply as this Court has recognized to safeguard the right to strike and now what I’d like to show is the very serious consequences that a bargaining lockout has on the right of employees to strike which this Court —

Potter Stewart:

Well, it doesn’t Mr. Come that — you — you correctly said that the basic underlying spirit of this legislation was to equalize — was to equalize and come you say into a balance.

And didn’t Congress proceed upon the assumption that the employer had the right to lockout and didn’t the Congress therefore explicitly confer the right to strike in order to equalize this.

Norton J. Come:

I don’t think that there is any affirmative indication that that is (Voice Overlap)

Potter Stewart:

But you agree with me don’t you that the employer prior to any national legislation did have the right to lockout.

Norton J. Come:

That is correct.

That I would like to demonstrate —

Potter Stewart:

And you agreed further that the right to strike was in a serious question in the said area.

Norton J. Come:

I would like to demonstrate though that to give the employer the right to lockout far from equalizing the situation would give him an unduly advantage that would keep the scales in his favor.

Potter Stewart:

So the Congress gave it to him, I said the Congress proceeded on the assumption that he had it.

Norton J. Come:

Well, but Congress took it away.

We all acknowledge at least where it’s use to beat the union.

Now, the question is whether or not Congress didn’t take it away in other situations where its use would unduly cripple protected the employee rights and I would like to dwell for a moment on what this does to the right to strike.

I should point out, however, before I do that that this issue has come up in four circuits.

The Board has been sustained in three circuits.

I think maybe — maybe one.

In the Third Circuit, the Tenth Circuit, the District of Columbia and most recently in the Second Circuit in an opinion by Judge Hays which we have set out in our brief.

The only circuit that I didn’t see it our way was the Fifth Circuit in the Dalton case.

So we’ve been erring this problem through the circuits but getting back to the point I was trying to make, it is the — it is the Board’s judgment and courts have agreed with this — have agreed that the strike weapon can be fully effective only if the employees and their union representative have the right to control its use to decide when to strike, when not to and if to strike for how long, for the obvious reasons.

Norton J. Come:

Generally, a strike is called as a — as a last resort where it involves high cost to the employees and to the — and to the unions.

As proof of that in the 1964 strikes represented a fraction of 1% of total work time.

Because for the employees, it means a lost of wages —

William J. Brennan, Jr.:

Mr. Come, does this argument finally get you to the point that there never can be circumstances in which outside of the multiemployer set up that single employer may resort to lockout.

Norton J. Come:

No, it does not.

I —

William J. Brennan, Jr.:

What circumstances would the employer resort to lockout that would not have the effect to describe the force on the right to strike?

Norton J. Come:

Where it is used for a currently defensive purpose and does not preempt the use of the strike weapon.

The Betts Cadillac situation, if the union were to make it clear that was to fall a strike and that faced the employer with an unusual operating problems such as the head inventories that were going to spoil, the working process —

William J. Brennan, Jr.:

If we’re looking for general principle where the Board suggests them that the resort to the lockout weapon is never permissible except as a defensive move.

Norton J. Come:

I think that that is basically the line that the Board has drawn because in — it used that as an offensive weapon.

It preempts the use of the strike weapon altogether.

A union might never have intended to call a work stoppage.

As a matter of fact, in most cases, the strike weapon achieves its purpose existing merely as the threat of a strike in the — in the — in discovery.

The bargaining lockout enables the employer to call a work stoppage when the union might never have anticipated calling one.

Arthur J. Goldberg:

I don’t quite understand the use of the word defensive.

Suppose this situation — suppose that the union as like the Insurance Agents’ situation has a series of short strikes to push bargaining law, they feel the employer is not doing well by then in the bargaining process.

And suppose that after that has taken place for a little while, the employer says, “Well, perhaps I can do a bit of the same and since they know this out they will shutdown next week, we’ll lock you out.”

Would you think that these negotiations are dragging, do you think our position is right and we don’t claim economic necessity that we think we ought to get a deal.

And we think that the two can play this game.

Well, how do you interpret that type of lockout?

Norton J. Come:

I think in that case, you might well say that the union has already indicated that it is going to use the strike weapon and it has made it difficult for the employer to operate and that gets you pretty close to a Betts Cadillac line —

Arthur J. Goldberg:

The union disclaimed the right to hold full scale strike in its literature, in its resolution then in its statement.

Norton J. Come:

Well, the Board’s position is not so wooden that it’s going to force an employer to operate under circumstances where the union is playing games and I think that’s the kind of —

Arthur J. Goldberg:

Where do you find then the Board’s decision, the position that one knows that —

Norton J. Come:

Well, I think that you find in all of the lockout cases since Duluth Bottling in over the years, an indication that the Board looks pretty carefully to the facts of the particular cases.

Now —

Arthur J. Goldberg:

And the difficulty here is this, you, I think, correctly stated strike is a serious business, the union does not ordinarily engage in a strike and this was the last resort, all of which I think industrial history teach it.

But now it turned back to the facts of this case, it’s not always so.

It turned back to the facts of this case.

Arthur J. Goldberg:

You had strikes that occur in every exploration of the collective bargaining agreement.

And an impasse was reached and this employer, you could interpret this case to be this employer’s said, “Well, this time we’re going to call the two a little bit.”

Norton J. Come:

But on the findings of the Board which have been sustained by the Court of Appeals he had no reasonable basis for anticipating that there was going to be either a full-pledged strike or one of these quickie deals at any point in the picture.

Arthur J. Goldberg:

Accepting that why wouldn’t employer justified in saying to get the type of the agreement that we need in order to carry on our business without saying that there’s a lot of business, I think we’ll have to just — this ought to be done to bring a sense of realism into the collective bargaining process.

Norton J. Come:

Well, for the simple reason that giving the employer that power does in this particular case under these facts throws employees out of work who might never have gone out on work and they are out of work.

Now, the employer has these means that at his disposal, I mean the basic justification for resorting to the lockout and the circumstances that we have here is for him to get his contract terms rather than those that the union wants.

Well, he can do that without the lockout weapon.After all, the employer controls the employment conditions.

If the union us unwilling to strike, he can say, “Well, I think you’re early after an impasse.

I’m going to continue to operate under the existing conditions.

You can take it or leave it.”

And if they don’t want to strike, they’ve got to continue the work under the existing conditions.

Moreover, after an impasse, he could even alter the terms and conditions of employment.

The union cannot alter the existing conditions unless if the employer is unwilling, unless it has the strike weapon.

Moreover, the employer, the other justification that he has for using the lockout in the circumstances we have here is that, “Well, if I’m going to have a work stoppage rather take it now rather than later on when maybe I’m going to be busier and it will hurt me more.”

Well, he has a substantial means at his disposal for alleviating that problem without the lockout.

He has the right that Mackay recognizes to replace the strikers if they go out on strike and for that reason among others the lockout is not the corollary of the strike.

The lockout is in the right to shut down the plant completely under the — when the people strike and that’s a great deterrent as to whether they will strike or not, they run the risk of being replaced.

Now, the question was asked, “Well, isn’t — isn’t the lockout less horrendous than super-seniority in Erie or the Mackay right of replacement.

I submit that in the very real sense, the lockout is worst, much more severe in its impact on employee rights than the Mackay right of replacement for this reason.

The Mackay right of replacement operates only after the union has decided to call a strike.

I mean the union has made the choice, they’ve elected to take that drastic step, until they do there’s no right of replacement.

Secondly, having struck still not all strikers are affected, it’s only those that the employer is able to replace.

With respect to the lockout, however, the employees have — have no choice in the matter.

Even those that may not have even had gone out on strike had the union called one are thrown out of work and we submit —

Potter Stewart:

Probably there’s a big difference.

A lockout is a temporary thing and the replacement, the Mackay replacement is permanent.

Arthur J. Goldberg:

Aren’t there straight focus as to follow the — that has covered both.

Aren’t their obvious restraints upon the employer or not whether to shut down the plant, (Inaudible)?

Norton J. Come:

That is correct.

What the Board submits that on the balance — the balance on the one hand, the impairment of the right to strike which this Court is repeatedly emphasized.

Norton J. Come:

Congress has shown a marked solicitude for it and it is not to be impaired unless you’ve got some specific provision permitting that.

Potter Stewart:

Well now, Mr. Come we talked about, we — we’ve talked about the basic purpose of this legislation as to give the equality of bargaining power.

And bargaining power assumes implicit in bargaining power are sanctions in the background.

Now, both sides have been clearly and explicitly recognized with the basic background ultimate sanction on the side of the employees is the right to strike.

And then I had it already though, that implicit also on the other side was the right to lockout otherwise where is the power, where is the bargaining power on the employer.

Norton J. Come:

I submit that that view, I respectfully submit, overlooks the fact or at least does not fully take into account the fact that the employer has these other alternatives at his disposal, the utterances that were made at the — at the time that the lockout is the corollary of the right to strike were made at a very early stage of the development of this law.

It wasn’t until some years after the Act was enacted that this Court recognized that there was such a thing as the employer’s right to replace.

It wasn’t until many years thereafter, I think in the early days of Taft-Hartley that it was finally established that the employer had the right to act unilaterally after an impasse has been reached.

And when you take into account these alternatives that are available to the employer under the scheme of our act and put them into the equation, I submit, that the Board was not unreasonable in concluding in this that giving the employer the right to lockout in these circumstances just tips the scale too far as Judge Hays pointed out in the Second Circuit case.

It blunts the strike weapon and instead of establishing the equality which the Act seeks to attain, it tips the scales unduly in the employer’s favor.

Now, I want to say —

Arthur J. Goldberg:

Well, what do you say from this fact, that of 85% of all labor agreement usually contain a clause.

It says, during the term of this agreement, the union shall not strike and the employer shall not lockout.

Isn’t there sort of an implication at least from that statement that when the agreement expires that we’re both free to fight it out if we have to?

Isn’t that the kind of implication you get from that?

Norton J. Come:

Well, I think that the — to be frank with you that that’s one interpretation.

The other interpretation which I think I submit is equally reasonable is that many times collective bargaining agreements contained provisions with respect to things that are admittedly unlawful.

I mean you have provisions in there.

There shall be no discrimination on account of union membership.

So you could say that the fact that there’s no lockout there, it’s merely an attempt to cover something which might well be — that to give a contract remedy for something, it might also be an unfair labor practice and if I might have just one half second more Mr. Chief Justice.

The other question — reason for it may well be that oftentimes there’s a semantic problem as to whether you got a strike or a lockout.

Even though the union has taken the initiative in calling the work stoppage, it might be termed either by the union or by other people as a lockout because it was the employer’s action that engendered the impasse that’s caused the lockout.

And I think that part of the reason why the terms are used together might be to cover such a situation.

Tom C. Clark:

How widespread is the use of lockout?

Norton J. Come:

To my knowledge Your Honor, it’s not very widespread at all.

Tom C. Clark:

It follows the limits of the (Inaudible).

Norton J. Come:

I think it is because it’s been pretty well settled.

One of the reasons may be that under the National Labor Relations Act the employer couldn’t use a lockout for this purpose.

What would happen should this Court rule otherwise, I don’t want to speculate on, I think it might well be more widespread where this Court to rule that it was a permissible weapon.

Up to now, it has not been a significant factor.

Tom C. Clark:

But it has a factor against the union and the employer.

When it closes, they lose job.

Norton J. Come:

Well, if he feels that he can get a contract on his own terms though, however, it may be worth it.

Particularly, if he can do it at the time when he thinks that’s a slack season or he had built up inventories.

Thank you.

Earl Warren:

Mr. Tyson.

William S. Tyson:

May it please the Court.

I have just a few scattered thoughts that I would like to leave with the Court.

In response to what Justice Clark asked a moment ago, I believe there’s a statement in the respondent’s brief that the bargaining lockout has not brought to where many questions as I understand or there hadn’t been very widespread.

I would like to say that our opponents here particularly in the amicus briefs have not come forward with any valid proposal which would solve this thing.

The only thing they come forward with is let’s repeal all the cases that are against us.

They want this — they come in and asked this Court to repeal or reverse the Mackay Radio case, to reverse the Truck Drivers case, to reverse the Insurance Agents’ case, and as I read the briefs, I am convinced that they would deny self-help to employers or as this Court has said, “Employers are entitled to under the Taft-Hartley Act.”

Arthur J. Goldberg:

Mr. Tyson, how would you answer this, which I think is underlies and splashed out of the last moment.

For your type of employer here it seems a pretty legitimate weapon to lockout, the union has done so in a series of occasions.

Take the newly organized plant where the union has gone through difficult experience in organizing.

It never has a contract and under your theory of the case, first negotiation when the employer says not — I accept the union, I accept this certification, but I’m going to close this plant down because we’re not going to pay what the union wants.

Do you think the union would be that the right to strike or the survival of the union wouldn’t be amount too much if that were validated?

William S. Tyson:

I am very pleased that you asked that question if Your Honor please because I had failed to make clear that I am in thorough agreement with what this Court said in the Truck Drivers case that the rights protected under Section 7 for the employees that an invasion of those rights in an attempt to right the union or frustrate organizational levels —

Arthur J. Goldberg:

What does the employer says, I don’t want to break the union, all I want is to preserve my existing wage scale which I think is the only way economically I can operate, and then therefore in order to make clear that I’m serious about this and that I better shut so the people will be able to influence their union to make this highly reasonable deal.

William S. Tyson:

Of course, as you know Justice Goldberg, neither side is forced under this Act to make a concession and we get to that question that you asked a moment ago about an impasse and in further response to that, in considering the questions that were asked by you and by Justice Brennan, I think my thinking on that probably was heavily weighted because of the situation here where there was an impasse.

And I’m convinced that from a legal standpoint, an impasse may not be a prerequisite.

I would like to say —

Potter Stewart:

You might — you might be guilty of a refusal to bargain if you — if there is strike or a lockout before an impasse or refusal to bargain and in good faith which is also a violation of the Act.

William S. Tyson:

You could be — you could be that that —

Potter Stewart:

Because you have the duty to bargain to an impasse generally speaking.

William S. Tyson:

That’s possible.

I would like to say that Section 13, we think, does not confer the protection against the strike which is contented by the respondent.

We think that that section was put into the Act originally in the Wagner Act to make it clear as you pointed out Mr. Justice Stewart that the Wagner Act did not proscribe or prohibit strikes.

In other words I was trying to show that strikes were legal after Wagner Act and I don’t think that has been changed and I don’t think it’s a protection against the lockout.

It has nothing to do with that at all.

William S. Tyson:

I’d also like to point out that this — as one of the amicus brief said, if the employer did not have the right to make replacements, your argument might be a valid one.

I’d like to say that the replacement question is one that seems to be confused here because the right to make replacements, we think, is a paper right.

Where would you find qualified replacements for the highly technical jobs that are in most industrial plants today and furthermore who would have the nerve to disturb industrial peace in Pittsburg or Chicago or New York by using replacements, so we think that is not a valid argument and we also think that the use of the lockout is not going to disturb industrial peace because as suggested earlier, we are convinced that no employer is going to shut down his plant and take that chance without valid and justifiable reasons.

Thank you very much.