Auciello Iron Works, Inc. v. National Labor Relations Board

PETITIONER: Auciello Iron Works, Inc.
RESPONDENT: National Labor Relations Board
LOCATION: Colorado Republican Party

DOCKET NO.: 95-668
DECIDED BY: Rehnquist Court (1986-2005)
LOWER COURT: United States Court of Appeals for the First Circuit

CITATION: 517 US 781 (1996)
ARGUED: Apr 22, 1996
DECIDED: Jun 03, 1996

John D. O'Reilly, III - Argued the cause for the petitioner
Richard H. Seamon - Department of Justice, argued the cause for the respondent

Facts of the case

The day after Auciello Iron Works' contract offer was accepted by its union employees' collective-bargaining representative, Auciello disavowed the agreement because of a good-faith doubt, based on knowledge acquired before the offer's acceptance, that a majority of employees supported the Union. The National Labor Relations Board (NLRB) ruled that Auciello's withdrawal was an unfair labor practice in violation of the National Labor Relations Act and ordered that the agreement be reduced to a formal written instrument. The Court of Appeals enforced the order as reasonable after the NLRB issued a supplemental opinion to justify its refusal to consider Auciello's defense of good-faith doubt about the Union's majority status.


May an employer disavow a collective-bargaining agreement because of a good-faith doubt about a union's majority status at the time the contract was made, when the doubt arises from facts known to the employer before its contract offer had been accepted by the union?

Media for Auciello Iron Works, Inc. v. National Labor Relations Board

Audio Transcription for Oral Argument - April 22, 1996 in Auciello Iron Works, Inc. v. National Labor Relations Board

William H. Rehnquist:

We'll hear argument next in Number 95-668, Auciello Iron Works, Inc. v. National Labor Relations Board.

Mr. O'Reilly, you may proceed.

John D. O'Reilly, III:

Mr. Chief Justice, and may it please the Court:

Some 8 years ago we started what I thought was a run-of-the-mill, garden-variety type labor dispute which has grown and grown, and here we are.

In the course of a collective bargaining dispute, the... a strike arose; picketing took place.

Immediately during the course of this garden-variety dispute, 40 percent of the employees, the bargaining unit, crossed the line, the same 40 percent which, it's a small unit, that 40 percent is only 9 employees, were badmouthing the union.

The employer, during the course of this 5 or 6-week strike, obtained the belief that because of the 40 percent the union did not have the tremendously strong percentage of support, and it shot across the bow of the union bargaining position a rather extreme shot.

It beefed up its contract proposal.

However, the significant point, when it beefed it up, it did not have, then, reason to believe that the union was not a majority representative.

It had every reason... in fact, the... it would... to believe that the union still maintained its majority status, but it shot this across the bow of the union, this beefed-up union proposal, and at that time the negotiations are broken off.

The very next day, the union abandoned the picket line, the pickets went down, and a number of extraordinary events took place over the next 3 business days.

Everyone... almost everyone came back to work.

Of those who came back to work, a number of them did the same as their predecessors, the 40 percent who had come back earlier, had crossed the picket line, were knocking the union, being very critical of the union.

In fact, four additional employees resigned from the union after they came back, spoke to company representatives and said, we don't need the union, I don't know why we wanted a union in the first place.

Three of these individuals who were thus bad-mouthing the union had been picketing that Friday morning.

Friday afternoon they were in saying to the company, ah, we never needed a union here in the first place.

Sandra Day O'Connor:

Mr.... Krischer, is it?

Excuse me, Mr. O'Reilly--

John D. O'Reilly, III:


Sandra Day O'Connor:

--Are you making any claim here that the union in fact lacked majority support at the time the union accepted the offer?

John D. O'Reilly, III:

Justice O'Connor, I have been making that claim not only today but for the last 8 years.

I know the issue has been raised in respondent's--

Sandra Day O'Connor:

Is that issue in front of us, do you think, properly?

John D. O'Reilly, III:

--I believe it is, Your Honor, particularly, I--

Sandra Day O'Connor:

Did the board deal with the case in that posture, or not?

I somehow thought that we had before us a... the issue of whether there was a good faith doubt, not whether there was in fact lack of support.

John D. O'Reilly, III:

--Justice O'Connor, I believe you have both issues before you.

The facts clearly indicate... for instance, the company's telegram that it sent eventually, in response to the union's Sunday evening telegram said we have reason to believe that the union no longer represents a majority.

William H. Rehnquist:

There may be any number of facts in the case that are not before us.

Your question presented is whether an employer is bound by a union's acceptance of an earlier proposal for a collective... when at the time of the union's... the employer had a reasonable basis for a good-faith doubt of the union's continued majority status.