H. K. Porter Company, Inc. v. National Labor Relations Board

PETITIONER:H. K. Porter Company, Inc.
RESPONDENT:National Labor Relations Board
LOCATION:Dodge County Juvenile Court

DOCKET NO.: 230
DECIDED BY: Burger Court (1969-1970)
LOWER COURT: United States Court of Appeals for the District of Columbia Circuit

CITATION: 397 US 99 (1970)
ARGUED: Jan 15, 1970
DECIDED: Mar 02, 1970

Facts of the case

Question

Audio Transcription for Oral Argument – January 15, 1970 in H. K. Porter Company, Inc. v. National Labor Relations Board

Warren E. Burger:

Number 230, Porter Company against the National Labor Relations Board.

Please give us a moment if you will counsel.

Mr. Winson, you may proceed whenever you’re ready.

Donald C. Winson:

Mr. Chief Justice and may it please the Court.

This case is before the Court on short certiorari to review a per curiam order of the Court of Appeals for District of Columbia which enforce a supplemental order of National Labor Relations Board.

The Board’s order was entered that gives the petitioner H. K. Porter Company supposedly as a remedy for bad-faith bargaining in violation of Section 885 of the National Labor Relations Act.

More specifically, the company was found to have refused to agree to a union’s demand for a dues checkoff provision for the purpose of frustrating an agreement with the union.

The Board supplemental order which is the focal point of this controversy before this Court requires the company to “grant to the union a contract clause providing for the checkoff of union dues.”

The very precise, very clear cut issue now presented is whether the Board under the National Labor Relations Act has the power to order a party to agree to a substantive provision of a collective-bargaining agreement.

The company of course takes position that Board has not has such power.

The Board now says that it has the power to order agreement to a substantive provision.

The bargaining that’s actually involved in this case —

Hugo L. Black:

What substantive provision?

Donald C. Winson:

The substantive provision Mr. Justice Black was a dues checkoff provision — a provision of course and a collective-bargaining agreement by which the company pays and assist the union in the collection of dues by deducting the due — union dues from the employees’ wages and then transmits them to the union.

Warren E. Burger:

In other words that the Board said that this was a demand of the union to which the company must agree?

Donald C. Winson:

The way the case worked out Mr. Justice — Mr. Chief Justice, it actually worked that way.

The Court of Appeals is actually if I may say so the instigator of the remedy here is as to what has occurred.

This case went through the Examiner.

The Examiner recommended the general bargaining order.

The case then went up to the Board, the Board adopted the general bargaining order, it went to the District of Columbia Circuit.

The District of Columbia Circuit enforced and refused the union’s request for a direct order which we are now arguing about which was later entered but on the first time up the District of Columbia rejected the union’s petition, District of Columbia Circuit Court.

Then, after that occurred, we filed a petition for certiorari with this Court.

We took the position that because of the wording used in the opinion, it seemed to us that the Court of Appeals was telling us if you want to avoid contempt, you had better agree without any further talking.

Well, when the Court — when this Court denied our petition for cert, we then took the interpretation which we felt we had to under the laws.

We interpret the law that the general bargaining order required us to bargain over a dues collection system but not simply to walk in and agree.

The union took the position of those subsequent negotiations said, no Porter you are now required to agree and we don’t have to talk to you any more about it.

You are required to agree to do dues checkoff provision.

Warren E. Burger:

Well, did not the original opinion of the Court of Appeals suggest that very thing.

Donald C. Winson:

It suggested that in order to avoid contempt.

The Court could not see how we could avoid agreeing.

Donald C. Winson:

Well, Mr. Chief Justice, when we went then went — gone in the position of the verge of interpretations of this original bargaining order.

The union then asked the Board to initiate a contempt proceeding.

The Board’s Regional Director advised the parties that the company had now complied with the bargaining order and that the case was thereby closed.

The union then found a motion for clarification with the District of Columbia Circuit Court.

The first time, the Circuit Court denied the motion for clarification and said, we think contempt is a proper route to test compliance.

Then, the union went back to the Court of Appeals for the second motion asking for reconsideration of the earlier motion.

This time, the Court of Appeals came up with an opinion of course remanded the case to the Board and that’s why we have a supplemental order before this Court and instead of the original order.

The Court of Appeals in its second opinion, its clarifying opinion told the Board that we feel under the — that Section 8 (d) of the Act does not prohibit the Board for entering an order to agree to a substantive contract provision and that the Board can either order agreement directly or it can compel a concession that will be given in exchange for the demanded provision.

Hugo L. Black:

Now, why are you using citation to a place where the Board compelled by words the other party to agree to specific provision on the contrary?

Donald C. Winson:

It is in the supplemental order issued by the Board and shown Mr. Justice Black on page 4 of Porter’s brief under statement of the case.

Warren E. Burger:

Is it in the appendix also?

Donald C. Winson:

Yes, it’s in the appendix also.

Warren E. Burger:

You can get to us in both — give us both citations if you will.

Donald C. Winson:

Yes.

Hugo L. Black:

Now, what part of the appendix, I now have it before me?

What page?

Donald C. Winson:

It’s on page 137 of the appendix, supplemental orders first on left hand side page 136.

A general bargaining order is first entered and at the top of the right hand page 137, the order is grant to the union a contract clause providing for the checkoff of union dues.

Hugo L. Black:

That’s the phrase that you relied?

Donald C. Winson:

Yes.

This case presents to the Board or presents to this Court for the first time in the 35-year history of the National Labor Relations Act a situation in which the Board has ordered one party to agree to a contract term.

We submit that this order violates both the specific intent of Congress as expressed in the wording of Section 8 (d) of the Act as well as the basic premise of freedom of contract as contained and has been recognized to exist in Section 8 (d).

This Section of the Act provides that the obligation to bargaining good faith does not compel either party to agree to a proposal or require the making of a concession and of course this Court in both the American National Insurance case and the Insurance Agents case recognized Section 8 (d) as prohibiting the Board from either directly or indirectly, compelling concessions or from otherwise sitting in judgment on the terms that collective-bargaining agreements.

It’s true that Section 10 (c) of the Act permits the Board to enter such remedial orders such affirmative orders as will effectuate the policies of the Act.

We recognized the distinction that the Court of Appeals and the Board and the union are now arguing that Section 8 (d) itself does not directly relate by express terms to the scope of the remedy.

But it certainly expresses a fundamental policy of the Act that of freedom of contract.

This Court and the cases I cited a moment ago recognized that that — the intent of Congress and the legislative history was well cited by Mr. Justice Brennan in the Insurance Agents case that the intent of Congress was to keep the Board from either directly or indirectly compelling agreements.

We contend that the supplemental order is in clear derogation in violation of this fundamental policy and it’s interesting that the Board until a supplemental order took exactly the same position.

The Board did not enter even though union demanded that the Board did not enter a direct order to agree initially.

And in fact, when we filed our petition for cert the first time in this Court, the Board took the position that if bargaining order did not violate Section 8 (d) that it merely orders to bargain in good faith and they pointed out specifically that they had not violated Section 8 (d).

Donald C. Winson:

The Court of Appeals —

Potter Stewart:

Where is that in the record?

Do you have it off hand to page 9 of the appendix?

Donald C. Winson:

Yes.

We cited in our brief — that would be on page 15 of the Porter brief Mr. Justice Stewart.

Right inside of a page and this was an answer to our petition for certiorari the first time and the Board pointed out there that the original order did not violate the provisions of 8 (d) if I may address one moment.

You’ll recall that we were arguing that the effect of the Court of Appeals’ opinion was to cause us to agree and the Board points out that the original order did not violate Section 8 (d), that a statutory duty to bargain does not require to making of a concession.

The Board’s order merely directs the company to bargain in good faith.

Potter Stewart:

You don’t know where that is in the appendix, do you?

Donald C. Winson:

I doubt if the briefs would be in the appendix Your Honor.

Potter Stewart:

I know, I mean the — wouldn’t that order of the Board be in appendix?

Donald C. Winson:

The original Board — order of the Board is in the appendix.

Potter Stewart:

That’s what I mean.

Donald C. Winson:

The original order is on page 55.

Potter Stewart:

So, it will be somewhere there?

Donald C. Winson:

Yes.

Warren E. Burger:

Of the appendix?

Donald C. Winson:

Well, they adopted the recommended orders.

I should refer you to page 52 for the Examiner’s recommended order.

The Board merely having adopted that and the recommended order was a negative and an affirmative cease and desist from refusing the bargain in good faith and affirmatively bargain.

And of course I point out that the Board’s Regional Director subsequent to this original bargaining order found that the company had bargained.

This is when the company came to the union and said, we are ready to bargain now over a dues collection system and the union took the position.

No, you are required merely to agree now and then when the union asked the Board to initiate contempt, the union adv — pardon me, the Board advised the parties by letter that the company had complied of both the negative and the affirmative requirements to that original order and that the case was hereby closed.

Now, I point this out very frankly it has nothing to do with the issue now before this Court except that the union and the Board in their briefs argue appropriateness.

They say very little I suggest about the statutory power or what we contend be the lack of statutory power but it do argue appropriateness even though they contempt, we haven’t raised the issue.

Well, I submit to you that a general bargaining order must be appropriate in the very case in which the Board found that it effectuated the desired result that is it got the employer to bargain.

Hugo L. Black:

As I read the Government’s brief and its questions that were presented, it agrees with you that the issues whether it has power to compel the making of that agreement?

Donald C. Winson:

Yes, that is the issue Mr. Justice Black.

Hugo L. Black:

Is there any denial of it in any other part of the Government’s brief?

Donald C. Winson:

That is the issue, we’re all in agreement.

Hugo L. Black:

All agreed that the question is, whether under the law the Board on any circumstances has power to compel a company to agree to a specific term in the contract?

Donald C. Winson:

That is — I think we are all in agreement that that is the specific issue.

I would like to call the Court’s attention if I may to the approach used by the Court of Appeals.

The Court of Appeals very properly recognized that freedom of contract is a fundamental policy and premise of the Act and they agreed that remedies which impinge on it are not to be lightly undertaken.

But they then pointed out under that Section 10 (c) the Board is to balance the policies and this is to try to move forward onto all policies.

They then cited the — what they considered to be an equal policy and that is a policy of the Act to equalize the bargaining power of an employees and employers by assuring the right of workers to bargain collectively.

The Court of Appeals then proceeded to cite such alleged facts as the fact that the dues checkoff provision is in 92% of industry contracts, the dues checkoff is likely to be a life or death import to a fledgling union.

The dues checkoff provision and ordering evidence is only a minor intrusion on freedom of contract.

They even cited the fact that the union’s nearest office was 85 miles away that the employees were scattered over a wide area.

The Court concluded that the collection of dues without dues checkoff provision had presented the union with a substantial problem of communication in transportation.

We submit that this approach although laudatory in the balancing of the policies but this approach of looking at the need of the union for this provision and in saying its of little effect to the company and of course it has been cited all through the record at the original hearing.

The company said, we’re not objecting as a matter of inconvenience and so forth cost.

I submit that this is exactly what 8 (d) prohibits that 8 (d) and that this Court has recognized that 8 (d), the Congress prohibited the board from policing the needs, from sitting in judgment on whether one party should have had the provision and the other party didn’t have good enough reason for denying it.

In fact, I also suggest that this area of whether a business reason is needed for refusing a contract demand by the other bargaining party is part of the issue of this case.

William J. Brennan, Jr.:

Well, Mr. Winson I gather that the Board found here that Porter had taken a bad faith or otherwise impermissible bargaining position, is that right?

Donald C. Winson:

Yes, Mr. —

William J. Brennan, Jr.:

Or did so fine?

Donald C. Winson:

Yes, Mr. Justice Brennan the actual —

William J. Brennan, Jr.:

And I understand the Board’s argument to be that 8 (d), it doesn’t permit a party to refuse to agree to a proposal or a reason which violates the statute, do you take a different position?

Donald C. Winson:

Yes, I do.

William J. Brennan, Jr.:

And that is you take the position that 8 (d) protection with regard to good or bad faith?

Donald C. Winson:

I think it has to Mr. Justice Brennan for the very reason that everybody is in agreement to the 8 (d) prohibits the Board from using a refusal to agree as evidence of bad faith.

Well, to me it seems illogical to say this and at the same time say that once bad faith is found on the basis of other evidence and this is all subjective intent that then the Board can order agreement on the very same contract —

William J. Brennan, Jr.:

Is there any in the legislative history of 8 (d) which indicates the Congress dealt with its application in the context of a finding of bad faith?

Donald C. Winson:

In the context of the finding of bad faith, yes.

William J. Brennan, Jr.:

There is in the legislative history?

Donald C. Winson:

Yes, I think we’re all in agreement that on the finding of bad faith that is on the use of a refusal to agree as evident to bad-faith bargaining that I think the intent of Congress is clear than everybody agrees with it.

It’s on the scope of the remedy which is where we’re running into our problem now.

It’s on the scope of the remedy and of course to us, if the evil to be cured — the evil that Congress was after here was to keep the Board from intruding into the collective-bargaining process.

Well, to prohibit the use of a refusal to agree as evidence, but at the same time for Congress to have permitted an order to agree to that very same contract provision.

Donald C. Winson:

This doesn’t make sense it seems to us.

Now, the legislative history and as this Court has recognized the intent of Congress is too broad for that we submit.

It’s too much for example for this Court to say that the Board was prohibited from directly or indirectly sitting in judgment for example.

Now, what the Court of Appeals just I cited a moment ago —

William J. Brennan, Jr.:

Of course Insurance Agents didn’t involve the situation like this whether is a finding of bad faith on the part of the employer?

Donald C. Winson:

No, it was not —

William J. Brennan, Jr.:

That actually was conduct of the union, wasn’t it?

Donald C. Winson:

Yes and that was a case of regulating the economic weapons.

I would submit Mr. Justice Brennan.

There is a closer analogy of the Insurance Agents’ case of this one is merely the wording in your opinion which of course we rely heavily upon.

And I cite — I must give credit to the Chief Justice for my argument on this point, but he dissented.

The Chief Justice dissented in the Ronald case in the District of Columbia Circuit which happened by coincidence via dues checkoff case also.

And as the Chief Justice pointed out there, the grant or refusal, the presence or absence of a dues checkoff provision is in effect an economic weapon in the sense that the union without a dues checkoff provision is there’s no doubt in many cases.

They are under an economic pressure but as Chief Justice pointed out in his dissenting opinion in that Ronald case, an employer with his employees on a strike is harmed even more.

Also, we’re talking in effect I think about the bargaining tool of bargaining tactic granted Porter did not say that the union in this case.

We are withholding or refusing to agree the dues checkoff because we wanted to trade it next year, but the more a union would demand the provision like this, obviously, the more the employer is going to resist to the point of getting something in return —

William J. Brennan, Jr.:

Do you support taxes, any support for the — or is there any problem fuel up, to put it that way?

Donald C. Winson:

It doesn’t present any particular problem, I don’t think it present any particular problem for me, what do you have in mind specifically Mr. Justice Brennan?

William J. Brennan, Jr.:

Well, that was an instance wasnt it of conduct on the part of an employer which was in violation of that statute?

Donald C. Winson:

But I don’t believe there was an order, I don’t believe the order went beyond a restoration type remedy, did it not?

William J. Brennan, Jr.:

No, it didn’t try.

Donald C. Winson:

And the union of the Board or cites that as a “basis.”

This case, I don’t think this Court will argue beyond our brief.

This case certainly goes beyond the restoration of status quo.

William J. Brennan, Jr.:

Well, may I ask you Mr. Winson.

Do you — perhaps I’m only repeating the question I asked you earlier.

I gather your position is that in the application of 8 (d), it’s immaterial whether the employer’s conduct was in good or bad faith?

Donald C. Winson:

Well, no Mr. Justice Brennan for the reason that the bad faith has to be there or we wouldn’t be to the point of the remedy in a bargaining case.

In other words, in 8 (a) 5 case except for a mere refusal but I mean that of course is bad faith, but what I’m saying is that where the parties have bargain or has sat down and mend there the finding of an 8 (a) 5 violation, then that has to be premised of course on bad faith.

So we’re now at the point of a remedy for the union in the Board to argue here that there is a line that can be drawn by this Court.

Donald C. Winson:

We submit is it’s just not practical to talk for example was the union does of run-of-the-mill cases that by all might, they wouldn’t suggest that this kind of an order could be entered in a run-of-the-mill bargaining cases.

Who’s to determine what is the run-of-the-mill bargaining case?

Taking the Court of Appeals words they say, this is only a minor intrusion.

Who’s to determine whether it’s a minor intrusion?

All of these is what Congress told the Board to stay out of with Section 8 (a) 5.

Warren E. Burger:

I’m not too clear on your response about the factor of good faith.

Let me try it with a hypothetical.

Suppose in a period when and in an area when increases are being granted of 5 cents in hour widely in an industry, a particular employer receives an offer from the union — demand from the union for 5-cent an hour increase very modest demand, much below the others and an employer refuses to grant any increase.

Do you think that the Board can inquire into the good faith or bad faith or presence or absence of either and use it as a basis to direct the employer to grant a 5-cent an hour increase?

Donald C. Winson:

Of course taking the last part, I take the position that in no circumstances can a party be ordered to agree.

But to take your question you’ve asked me, of course the Board if these were charged and if the complaint was issued by the Board then obviously the question to be answer by the Examiner at that point by the Board would be did the employer bargain in good faith?

That is subjective intent and I’m sure that this charge wouldn’t have been filed merely on a refusal in nickel-wage increase at least I don’t think so.

You’ll notice for example in this case, it wasn’t merely refusal to agree.

The Examiner set the refusal to agree was to frustrate an agreement then they took it a different step.

It’s a little different from Ronald in this extent you’ll recall.

But in the hypothetical, you’re asking me certainly the question has to be was it good faith or bad faith, but once the Board found that yes the employer refuse to agree to a nickel-wage increase in bad faith in the sense he was bargaining in bad faith and there must have some other reasons.

They had a secret motive of trying to get rid of that particular union president or business agent.

In other words, some doctrines were discovered in some extrinsic evidence find that the employers now have been found guilty of bad-faith bargaining in violation of 8 (a) 5.

But we submit that at that point, the Board cannot order the company to agree to that provision.

Warren E. Burger:

But we are only dealing with the remedy problem here, aren’t we.

Donald C. Winson:

It’s only a remedy problem where the Court of Appeals distinguishes and says that it’s a matter that 8 (a) 5 is relating only to the determination issue — the evidence issue.

William J. Brennan, Jr.:

Yes, but even though it’s only a remedy problem, am I wrong in thinking that your position is that the language of 8 (d) that such obligation does not compel either party to agree to a proposal or require the making of the concession that that language operates as a limitation upon any remedy?

Donald C. Winson:

Oh!

Yes, I’m talking about —

William J. Brennan, Jr.:

That’s your basic position?

Donald C. Winson:

That’s the position —

William J. Brennan, Jr.:

It doesn’t make any difference to all whether the position that the company has taken in bargaining is a good faith, bad faith, one or the other.

Donald C. Winson:

That’s my position, exactly.

William J. Brennan, Jr.:

And 10 (c) may be a broad power to the Board to address grievances but it doesn’t a 10 (c) however broad doesn’t go that far?

Donald C. Winson:

It doesn’t go that far because the 8 (d) policy stands on its way.

Donald C. Winson:

Something is coming in here we mentioned a moment ago is this, this business reason the Board and the union in their briefs.

The Board on its opinion in support of a supplemental order talked in terms that the company did not have a business reason.

I know of no law that says that you have to have a business reason.

Again, I cite the Chief Justice in his dissenting opinion to say —

Warren E. Burger:

That won’t help much here.

Even the majority opinion doesn’t help you very much from the Court of Appeals.

Donald C. Winson:

You mean on the Ronald case?

On the Ronald case.

Warren E. Burger:

You must pick a much better authority from that?

Donald C. Winson:

Well, I think your reasoning Mr. Chief Justice is completely applicable here and that is the question of holding even though you don’t have a business reason.

You just don’t agree to the provision because the union wants it so badly that when they give you something forth maybe not this year but the following year.

This is what bargaining is all about, we submit.

We submit this is what bargaining.

It has to do with here.

We think it’s redundant to say that the Board can order a party to agree and that he can order — that the Board can order into agree and order to effectuate the requirements of bargaining —

William J. Brennan, Jr.:

That I take it it’s one thing Mr. Winson about the issue of checkoff is either there will be or there won’t be checkoff it’s not to compromise that one.

Donald C. Winson:

That’s true.

William J. Brennan, Jr.:

Are there other any middle grounds of whether the will it won’t be a checkoff?

Donald C. Winson:

There are middle grounds of course in dues collection and this is what the company offered to discuss with the Board after the original or with the union after the original board order.

It offered to discuss a method — a satisfactory methods that are satisfactory to both parties for the collection of the union dues because there are other methods involved.

I mean there could be other ways in collecting the union dues, but generally speaking in this country in labor contracts, I would agree that it is usually either a checkoff provision or there isn’t a checkoff provision.

William J. Brennan, Jr.:

But that’s not the only provision of collective-bargaining contract it’s either or is it?

Donald C. Winson:

No it isn’t.

That’s exactly what I suppose to say.

This is only one provision Mr. Justice Brennan and it’s obviously a provision that can be traded.

You’ll recall from the facts involved in this case that the union at every bargaining meeting in fact that they’ve already involved here insistent they would never sign a contract without a dues checkoff provision.

We submit that this case is a landmark case and presents threshold issue to this Court and if the supplemental order is permitted to stand after this long 35-year history without this type of a remedy that we’re going to have a new scheme of bargaining.

We’re going to have exactly what happened in this case.

One in which the parties go as far as they can over the bargaining table and then one of the parties usually the union, of course will come to the Board and say that the company failed the bargain in good faith, we then have a finding of bad faith argue Mr. Justice Brennan on your hypothetical again, then the question of remedy.

Now, since it’s been a finding of bad-faith bargaining there may be primary — preliminary issues of whether it’s a run-of-the-mill case that was suggested to us or it may be a question of whether it would be a minor intrusion or so forth, that’s been suggested to us.

Donald C. Winson:

But in any event, the Board would have a power to order the company to agree to the very contract provision which the union could not obtain at the bargaining tables.

If the Court have any further questions, I didn’t reserve any time.

Thank you very much.

Warren E. Burger:

Mr. Cohen.

Lawrence M. Cohen:

Mr. Chief Justice and may it please the Court.

I’m appearing here today in behalf of the Chamber of Commerce of the United States because we in agreement with Mr. Winson believe that this is a landmark case with the National Labor Relations.

It involves the question as we have indicated of whether the National Labor Relations Board may dictate the terms of collective-bargaining agreements.

It has never done this before and it seeks to do so here and notwithstanding the clear language of Section 8 (d).

Hugo L. Black:

You said I understood both of you say the petition has never been presented to the Court before?

Lawrence M. Cohen:

No, I said the Board neither the Board nor the Court nor even any commentator has suggested up to this case that the Board has the power to dictate and tell the parties to a collective-bargaining association that these are the terms you must agree to.

Hugo L. Black:

That you must never been a Court which never been presented to us without standing?

Lawrence M. Cohen:

It’s never been directly presented to this Court, that’s correct.

Hugo L. Black:

Argued?

Lawrence M. Cohen:

And it’s never been argued to this Court of course by implication in numerous decisions of this Court.

This Court has indicated that that is not the function of the Board and Congress indicated that’s not the function of the Board.

So that that is really the question that we have here today as whether Congress meant what it said —

William J. Brennan, Jr.:

Well, Mr. Cohen.

Lawrence M. Cohen:

Yes?

William J. Brennan, Jr.:

Has there ever been an order like this requiring agreement of the insertion of a particular provision in a collective-bargaining agreement?

Lawrence M. Cohen:

This is the first case that’s ever involved this question.

William J. Brennan, Jr.:

That’s good reason why it’s never been here before?

Lawrence M. Cohen:

That’s correct.

That’s your very point.

This has never been done in this Court.

Lawrence M. Cohen:

That’s right, it is the point.

On a point that it’s never been done because it’s going to presumes that the Board this is the kind of a decision that the Board should not be required to make and should not be made by virtue of Section 8 (d).

Section 8 (d) is not a limitation only on the Board’s finding of good faith, it affects all the policies of the Act that can this Court indicated in defense deal case.

The Board seeks in this case that also to invoke this remedy not withstanding that it is decided that the remedy wasn’t required here and the fact to decide that that contempt powers of the Court of Appeals which is the traditional means of obtaining compliance with Board orders should not be utilized in this case.

It’s difficult to understand therefore how this case can be viewed by the respondent is one of only minor significance.

If the Board has the power in this case, there has a power in any case whatever it concludes that a party either a company or a union did not articulate the sufficient justification or a sufficient business reason or a union reason for refusing to accept the proposal that he could then compel acceptance to that proposal and regulate the results of collective-bargaining (Voice Overlap).

Hugo L. Black:

Is there in your remedy if it was same and clearly shown under your argument as the employer has just decided he will not agree to anything, he will not sign the contract, he keeps it going for 5 to 10 years?

Lawrence M. Cohen:

I think Mr. Justice Black that employer cannot use bargaining as a cloak cause I think the Fifth Circuit, a cloak or a device to preclude agreement.

I think the question is, did he seek an overall agreement.

I think the Board cannot say by virtue of Section 8 (d) that an employer who refuses to accept any particular proposal has therefore violated the Act.

It is not a per se type of violation, you offer to checkoff, we do not accept that therefore, we have violated the Act.

William J. Brennan, Jr.:

Well I gather anyway Mr. Cohen, really isn’t your position that no matter how intransitive an employer may be, all that can happen is an order to bargain collectively may be met?

Lawrence M. Cohen:

No, I —

William J. Brennan, Jr.:

And if the — well, some order of that kind but no remedy in any event goes far as require the employer to execute a particular provision or particular agreement is within the power the Board to make.

Lawrence M. Cohen:

That is correct.

William J. Brennan, Jr.:

Isn’t that it?

Lawrence M. Cohen:

It is —

William J. Brennan, Jr.:

And that if there are if an employer simply — is the kind that Mr. Justice Black suggest and then you get that what order as you can get than to be exist in his intransigents and you have to go to contempt to some other way of reaching it, isn’t that it?

Lawrence M. Cohen:

I suggest that the Board has not only a general bargaining power that’s remedial action.

It has numerous weapons.

It has a lot of ingenuity in devising appropriate remedies.

If those remedies fail for some reason, then there is a contempt power of the Court of Appeals.

For example, the Court of Appeals here in viewing this case in contempt would now look to the narrow question.

Did you or did you command a checkoff.

They found bad faith in this case originally because the employer had an anti — had negotiated with anti-union animus.

He refused to accept any form of dues collection not only a checkoff.

He voiced an attitude here that which the Board felt dissipated indicated disparagement of the union.

So that when a case we arrived in a contempt, the Court of Appeals would indicate does the employer still using the same negotiator?

Has he gone up for any form of dues collection?

William J. Brennan, Jr.:

Yes but when — no matter how bad his conduct has been, your position is that in any event the Board has absolutely no power under any circumstances to require and agree to a particular provision.

Lawrence M. Cohen:

That’s correct and if that it’s —

William J. Brennan, Jr.:

Unless all these by force of the language of 8 (d)?

Lawrence M. Cohen:

By force of the language of the 8 (d) and the policy that purveys the Act that the parties are the ones to decide what other kinds of a collective-bargaining agreement.

It suggested in the brief of the union that what they’re trying to do here is an effect engaged in a test or remedial reform that because of this problem that you just post which I think is the rare one, but because of their problem, the Board has to devise some kind of weapon here.

Well, that’s true and I don’t accept it to be the bet.

But if that’s true then that is the function of the legislature I suggest and not of the courts.

Lawrence M. Cohen:

If the remedies are inadequate here, if there’s a case in which it’s absolutely necessary that there be a compelled agreement despite language in 8 (d), then the legislature should put that in the Act.

There’s nothing in the legislative history the Act that indicates that that’s what Congress intended.

Byron R. White:

Actually, you’re saying is the prohibition in the Act.

Lawrence M. Cohen:

There is a direct prohibition in the Act and because of their prohibition, Section 8 (d) as you cannot compel agreement, that’s not a bad faith.

But the device of issuing a remedy correct their problem is indeed compelling agreement and that’s the crux that I think about our position here.

Warren E. Burger:

Mr. Come.

Norton J. Come:

Mr. Chief Justice and may it please the Court.

We believe that although this is a noble remedy this is far from a landmark case for the simple reason that the remedies stems on the basis of the facts of the particular case which are very unique.

Potter Stewart:

I just want to get your position straight to you.

It is clear is it not that it’s first time of the Board never done this ordered either party to a collective-bargaining, to agree to a particular provision in the contract, is that correct or incorrect?

Norton J. Come:

I believe that is correct, Your Honor.

Potter Stewart:

And you say that this is therefore not a very important but nonetheless it is not a very important case because this is unique (Voice Overlap) it’s not very unique but I think that’s tautological if it’s unique, it’s unique.

That’s a first time that the Board has ever ordered this remedy and you must be saying I suppose that this is the first that an employer has ever behaved this way and it’s through the Board, is that it?

Norton J. Come:

That is correct as I will attempt to show very, very briefly.

Hugo L. Black:

May I ask about one question?

Norton J. Come:

Yes, Your Honor.

Hugo L. Black:

I thought I had a big recollection that we had in a point of any contempt case before, is that right?

Norton J. Come:

Not, to my knowledge Your Honor —

Hugo L. Black:

Because you’ll probably know?

Norton J. Come:

The closest that this Court has had has been a case like Times for example very early today where an employer agreed to a contract and refuse to put it into writing and that situation the Board ordered him to execute the contract and this Court sustained that remedy.

Warren E. Burger:

Yes, he must do that, doesn’t he?

Norton J. Come:

The Act now in 8 (d) specifically says that he must do that.

Now, the employer here —

William O. Douglas:

May I ask this Mr. Come?

Norton J. Come:

Yes.

William O. Douglas:

I take it if the Board has this power, this is a two-way street and then maybe circumstances in which the union can be require to sign a — accept a particular course, is that right?

Norton J. Come:

That might be if you get a union in the situation that this employer got himself into.

I think that this employer as I will attempt to show very briefly faded himself into such a corner that the considerable freedom that he had to bargain he deliberately gave up —

Warren E. Burger:

Did the Board see in that light in the first instance before it went to the Court of Appeals, first time?

Norton J. Come:

Well, I think that the Board did Your Honor in so far as the basic violation —

Warren E. Burger:

But you can do with this remedy?

Norton J. Come:

The Board thought that the stereo type refusal of the bargain remedy would cure the situation but in the light of the post decree and negotiations, the further in like moment that the Court of Appeals gave the Board and after all the Board and the Court of Appeals are partners in this business of trying to work out a satisfactory administration of the Act, long appreciated that for this unusual type of situation something more than the conventional order to bargain was required.

Now, this is a situation whereon the Board’s unfair labor practice findings which were affirmed by the Court of Appeals and which this Court denied the company’s petition for certiorari on.

We have a situation where an employer has twice been found to have refused to bargain in good faith with the union — the purpose of frustrating an agreement with the union — any agreement with the union.

And the last —

Warren E. Burger:

How would the refusal to agree with checkoff frustrates any agreement with the union unless the union said they wouldn’t agree to any contract without a checkoff?

Norton J. Come:

Well, —

Warren E. Burger:

That’s the only way it could produce some impasse, isn’t it?

Norton J. Come:

It could produce an improper impasse if the employer’s reasons for refusing to agree are bad faith reasons.

Now, here is a situation where after the first refusal to bargain order — I might say that the union was first certified in 1961 for the next — the first set of negotiations broke off in 1962.

The Board found that the company was refusing the bargain in good faith and that order was enforced by the Fourth Circuit.

They then resumed negotiations in October of 1963 and they had 21 meetings and had still not reached in agreement.

It was only after the 20th meeting that the company gave up on one of the demands that was found to be a basis for the refusal of the bargain the first time.

At the end of the 21st meeting, you had three issues which was still unresolved — wages, insurance and the union’s request for a checkoff provision.

Now, the record showed that the company did not resist a checkoff because there was any convenience to the company.

You have the chief negotiator of the company admitting that in the record or for any other business reason or because there was a company policy against the checkoff.

He pointed out that the company regularly made payroll deductions at this plant for Government bonds, for health insurance, for united fund which is equivalent to the united giver’s fund to a good neighbor or sunshine fund and he conceded that there was no more inconvenience in checking off union dues and there was in checking off for these other purposes.

He further —

Warren E. Burger:

What if the employer wanted to save the checkoff concession for a year when he couldn’t depart to give a very large wage increase?

Once he knew it was quite important to the union, was that — would that be a legitimate business reason to save it for the future?

Norton J. Come:

I know that Your Honor has suggested that would be so in the Ronald case (Voice Overlap) and I think I could assume arguendo that perhaps it might be, but there was no suggestion that there was anything like that here because you had five years of bargaining negotiations, there was no suggestion at all that the checkoff was being used as a trading device certainly in the course of five years of negotiations where you are bargaining back and forth if the checkoff is going to be use as a trading device, that would have appear.

The company negotiator frankly conceded at the Board hearing that is only reason for not giving the checkoff was that the company was not going to aid and comfort the union at this location.

William J. Brennan, Jr.:

Is that an illegitimate reason?

Norton J. Come:

I submit that in the context of this case, it is an illegitimate reason that has hypothetical to the basic tenants of bargaining in good faith because if you have to recognize a union as the collective bargaining representative as this employer did in bargain in good faith with a view toward entering into a contract — anything that you’re given a contract is going to give aid and comfort to the union.

And this employer was making that a touchstone.

In the context of this case, it indicated it beyond that that really the reason that he wasn’t giving it was just because the union was asking for it because he had agreed to checkoff for other purposes.

He agreed that there was no greater inconvenience in doing it for union dues.

And indeed, the further conceded that at other plants they did checkoff union dues and as the company counsel stated at one point in the record that page 16 that perhaps our refusal to grant the checkoff clause has been harassed of the international union.

Now, given this history in this context, the Board was justified in concluding as it did and as the Court of Appeals agreed that this was not a company that had a good faith reason for withholding the checkoff.

We are not suggesting that an employer has to grant a checkoff, they cannot in good faith refuse to grant a checkoff, but this was an employer who withhold a checkoff for the sole reason of blocking an agreement with the union and that indeed he had indicated that not only was this his reason but he had no other reason for withholding a checkoff.

Hugo L. Black:

May I say this as I understand your adversary’s argument do you think could good faith has nothing to do with that the law does not justify the Board in commanding that the particular provision be put on contract, isn’t that right?

Norton J. Come:

That is correct Your Honor and I —

Hugo L. Black:

I suppose Congress will pass the law providing the checkoff, can you think of any constitutional objection to that?

Norton J. Come:

No, I cannot.

I think that the short answer to their argument, I think is the one that Justice Brennan suggested in which I intend to come to in a moment namely that 8 (d) has to be read in the light of 10 (c) in the legislative history of 8 (d) in so far as I’ve been able to ascertain and I’ve studied that rather carefully shows no indication that Congress was concerned with the problem of a remedy once you had established that the refusal of bargain was in bad faith.

The main thrust of 8 (d) is that the Board in determining whether there is a — has been a refusal of bargain in good or bad faith should not regard as decisive or determinate that there — in determining bad faith whether or not the employer did or did not or the union did or did not agree to a certain substantive proposals as to whether they were reasonable (Voice Overlap).

William J. Brennan, Jr.:

Where Mr. Come assuming the breath that you argued for in 10 (c) as a — to that extent at least some qualification on the prohibition of 8 (d), where do you draw the line on this?

What’s the point in which you say, yes 10 (c) goes so far that we can ignore 8 (d) in this case, what’s the standard by which is to be decided when you may and when you may not ignore 8 (d)?

Norton J. Come:

Well, I think that key is to the — that the nature of a violation afford the standard where you have a situation like you have here where the employer has not only bargained in bad faith but he has indicated that he has no legitimate reason for withholding agreement other than this bad faith reason.

And the nature of the proposal is one like a checkoff whereas you have pointed out.

It’s a party cut and drive proposition.

I mean that it is unlike wages in the sense that there is most unlikely.

There can be any economic or business consideration that would qualify the amount of the inquiries.

Certainly, in that kind of a case namely the checkoff situation it is not doing violence to the policy of 8 (d) to say that the Board under 10 (c) can provide this kind of a remedy because otherwise —

Hugo L. Black:

May I ask you one other question?

Norton J. Come:

Yes, sir.

William J. Brennan, Jr.:

It seems to me like most of this is rare, what do you mean by bad faith and what that means?

Do you mean by bad faith that they have just decided they’re not going to make any agreement and they are offering the excuses to keep on doing so?

Norton J. Come:

I think so.

I think that they (Voice Overlap) they have used their refusal to agree to a checkoff as a cloak for not agreeing to any contract with the union at all.

Hugo L. Black:

Do you say they’re going through a form?

Norton J. Come:

Yes, Your Honor.

Hugo L. Black:

Of collective-bargaining and agreeing to bargain but in reality they won’t bargain —

Norton J. Come:

That is correct.

Hugo L. Black:

Now, what is the remedy if this is not the remedy I mentioned it sometimes for years to state, well, I don’t want to do this, right?

I would say that many of the things, I’m not going to collect dues from my workers.

I just don’t — that’s not a part of my business, I don’t want to have bookkeeper for that, could that be legitimate?

Norton J. Come:

If that were his reason and that is all that you had, there was no — there would not be an unfair labor practice finding here to begin with.

Hugo L. Black:

But on the other hand if instead that being, you say the Board is entrusted with the power to determine.

Well, that’s not your real reason; your real reason is you just don’t want to make any bargaining, would you?

Norton J. Come:

That is correct.

Hugo L. Black:

You’re not bargaining at all.

Therefore, that would it not sometime get to a position if that is right.

Well, if you cannot order that the contract be signed on a point that the Board sales and that the men could keep it going on forever.

Norton J. Come:

That is correct Your Honor and that is exactly what happened here because —

Potter Stewart:

I frankly think then that your answer to Mr. Justice Black’s question would mean that the Board could impose this remedy in any 8 (b) and (c) (5) violation.

Whenever there’s the finding of lack of good faith bargaining it seems to me then the Board would have power to impose it somehow.

And I think that might has to be your argument.

Norton J. Come:

I respectfully disagree, Your Honor.

Potter Stewart:

But isn’t that broad Mr. Come?

What about arbitration clause?

I don’t think things have changed much since I was in the practice.

Employers views about arbitration clauses where much as you described what you say was the position taken here by the spokesman for the company as to the checkbook.

Can you conceive that the Board, there’d circumstances in which the Board could compel an employer decide an arbitration?

Warren E. Burger:

Let me add to that, especially if the corporation said if the employers said, we’re a corporate body and our ability to agree cannot be to make contracts, cannot be delegated by us to anyone else, suppose they added that to Justice Brennan’s?

Potter Stewart:

Well, I think the usual argument; I used to make that kind of argument in Court.[Laughter]

Norton J. Come:

I think as an original proposition those are all valid, good faith reasons for refusing an arbitration of the law.

Potter Stewart:

Well, the law in the area of aid and comfort, they’re not going to lend that practically.

Norton J. Come:

Well, I think that aid and comfort in this case has to be read in the light of all of the facts that I have laid up which shows that this isn’t an employer who has turned down a checkoff either because he doesn’t want to get in to the dues collection business because it’s inconvenient for him.

He doesn’t want to prefer the union to other predators of his company or other legitimate reasons that you could think of which would be perfectly okay.

It wouldn’t have any 8 (a) 5 finding to begin with and you’d never get to the remedy.

Warren E. Burger:

What about saving it for the future that I mentioned before, would that be a legitimate business reason?

Norton J. Come:

I think that it might be yes, but this record, I’m not —

Warren E. Burger:

We are not coming to other thing.

Are you suggesting that it’s the obligation of either the union or the employer all these to reveal all the reasons why they do or do not agree?

Norton J. Come:

Well, I think that at some point those reasons should come out if you’re going to have good faith bargaining as this Court pointed out in Detroit case.

Hugo L. Black:

In which case?

Norton J. Come:

In Detroit case which Your Honor it involves the problem as to whether or not an employer who claims inability to pay had to substantiate his claim at some point by bringing forth his records.

I think that claims made in bargaining if they’re in good faith have to be honest claims and at some point the cards have to be laid on the table and certainly after six years of negotiations as we had here if the company’s real motive was to hold off the checkoff for trading purposes that should have come up.

Warren E. Burger:

I thought it was the essence of negotiation that a negotiator was entitled to keep his cards covered.

Warren E. Burger:

I think we’ll stop for lunch now.

[Lunch Recess]

Well, we have you stopped counsel.

Let me put another hypothetical to you to pursue something that Justice Brennan opened up on the reciprocity or two-way aspect of this kind of a remedy.

Suppose for example an employer made a demand for a provision in the union contract that the bargaining team they made up of such officers as the union would designate but that it would always include three members of the workforce of the particular unit.

And that he then asserted that this was because he wanted to encourage the union democracy and develop the sense of responsibility to the leadership of the union etcetera.

The union says, no, we’ll do this our own way.

Business agents as we — I don’t want any spies in here.

And they found her on that demand and have a complete impasse and get to just about where we are here.

Do you think the Board could order the union to agree to that provision under any circumstances?

Norton J. Come:

I don’t think so Your Honor because I don’t think you’d have an unfair labor practice there to begin with for two reasons.

And the first place I think that the composition of the union bargaining team would not be a mandatory subject for collective-bargaining, it does not within the area of wages hours and other terms and conditions of (Voice Overlap).

Warren E. Burger:

How did dues checkoff get to be negotiable bargaining issue?

Norton J. Come:

Well, I think that it is well settled and the company does not —

Warren E. Burger:

I mean how did it generally?

I suppose when unions began they didn’t have any checkoff, it’s a fairly recent development, isn’t it in the history of bargaining?

Norton J. Come:

Well, I don’t know that it is that recent but in any event most people in the field would readily agree that that is within the area of wages, hours and other conditions — terms and conditions of employment.

But the composition of the union bargaining team had vast a permissive subject of collective-bargaining like the strike valid clause or who signs the agreement type of thing that the Court had in Borg-Warner and the Court indicated there that with respect to that sort of stuff although the parties may be able to propose.

They cannot insist on impasse.

Secondly, even if it were within the area of mandatory bargaining on the set of facts that you give me, it seems to me that the union has a valid justification for refusing to enlarge the bargaining team.

Now, —

Warren E. Burger:

Would it be certainly be consistent with the spirit of the Labor Act and the Landrum-Griffin and the great many things to improve union democracy this way, wouldn’t it?

Norton J. Come:

Well, that may well be, Your Honor but as yet the statute only requires bargaining about wages, hours, other terms and conditions of employment.

That’s the area of mandatory bargaining.

Warren E. Burger:

Well then you picked one that would be within the orbit of mandatory bargaining.

Can you suggest one that under any circumstance that the Board could ever order the union to agree to?

Norton J. Come:

Well, I haven’t thought about it Your Honor.

I’m not but I think that the essential predicate though that to order in this case and that I find lacking in the hypothetical case that I’ve been getting is that in this case there was a threshold finding by the Board that the refusal to grant the checkoff was in bad faith.

And that the sole purpose for refusing to grant it was to frustrate in agreement with the union as Justice Black said.

The company went through the motions of bargaining what it really didn’t want in agreement and it was holding off on the checkoff because that was the way of carrying out its scheme of frustrating an agreement.

Norton J. Come:

Now, further more you have a record which shows did not only was this employer has reason but he had no other conceivable reason for opposing a checkoff so that you’ll have a refusal to bargain in good faith over the checkoff based upon this kind of evidence.

And the limited question in this case is not whether the Board has power to compel concessions under other circumstances but whether given this particular unfair labor practice finding that it is grounded as I have indicated the Board as a remedy for the refusal — that kind of a refusal bargain clearly order a checkoff.

And we submit that if you get this kind of a unique situation, a checkoff — in order to grant the checkoff is really the only frank thing to do because an order to bargain in good faith suggests that there’s something left that you could bargain about.

Now, in the situation that I have presented, the employer has so painted himself into the corner that there is nothing to talk about — talk would only make for additional delay because as the Court of Appeals pointed out when he goes back he can’t give the same reasons that he gave before for refusing a checkoff and to permit him at this point to manufacture new reasons that he admitted before were not a factor but make a mockery of the collective-bargaining process.

So what we’re left with then is whether or not 8 (d) in this particular situation that I’m talking about would preclude the Board from using its 10 (c) powers which would otherwise be broad enough to permit this kind of a remedy when absolutely by the Board in this situation from ordering a checkoff.

We submit that it does not for the reason that the legislative history of 8 (d) shows that what Congress was concerned about there was the Board making the initial finding of bad faith based upon the failure of the employer to concede or to a union proposal because of the Board’s judgment that since it was a reasonable proposal, it was unreasonable and therefore bad faith for him to refuse to agree.

That is not —

Hugo L. Black:

May I ask you about that legislative history?

Norton J. Come:

Yes, Your Honor.

Hugo L. Black:

I was over there at that time and I don’t know but is there anything that you see in any way indicated that any of the Senators or Congress had in mind that the Board could do this or is it more in the line but following the ideas of the Railroad Labor Act which when you reach the end you still got to strike a lockout.

Now what did you find in the legislative history that indicated caution?

I’m kind of to agree with you logically as to what should be done if they want to force you for governmental action.

Well, what do you find that indicates that there was any desire in anybody to force you by governmental action except by degree (Voice Overlap)?

Norton J. Come:

I think that the legislative history was silent on the question of what kind of remedy the Board could impose once it found an unfair labor practice.

The history is directed to the elements that go into finding a refusal to bargain in good faith or bad faith to begin with.

And there, the history indicates that Congress didn’t want the Board to make a bad faith bargaining finding based merely on the fact that the employer had refused to make a concession.

That’s as far as the history of 8 (d) carries you and as I showed you earlier the Board’s bad faith finding here is not based on any such consideration.

William J. Brennan, Jr.:

Now, Mr. Come surely the very basic premise of our whole labor relations instruction is that it regulated to see that the parties sit down to bargaining table and come out with agreements that they agreed upon and that Government shall not voice agreements upon them.

That’s the very essential of our own protection.

Norton J. Come:

That is correct Your Honor but —

William J. Brennan, Jr.:

Doesn’t — does it whether under the guides of remedy or anything else, isn’t that rather to assert such power to that in conflict with that basic premises.

Norton J. Come:

Well, I think there are two answers to that.

The first place, this Court recognized even in Insurance Agents (Voice Overlap) that even in finding the — whether or not there has been an initial refusal of bargain in good faith.

There is a tension between the freedom of contract and the duty to bargain in good faith.

Judge Magruder put it and read in parens, you can’t be blinded wholly to the reasonableness of the proposals.

I mean if there — but beyond that once you have found on the basis of ample evidence that has nothing to do the reasonableness of the proposals that the employer has bargained in bad faith.

You have to balance the freedom of contract policy of 8 (d) against other policies of the Act — the policy of bargaining in good faith toward an agreement is the policy of an effect or providing effective remedies for serious — for refusals to bargain and are meaningful in the particular context.

Then when you balance those policies against the freedom of contract policy in a particular situation that we have here, we submit that on balance the Board could reasonably conclude that the policy of 10 (c) predominates.

Mr. Come is there any finding here that the purpose of the employer view is to weaken the union because of an agreement checkoff?

Norton J. Come:

The —

I didn’t see anything.

Norton J. Come:

The finding of the Board was most clearly rearticulated in its supplemental decision where on page 135 whereas it says, as the respondent has repeatedly violated Section 8 (a) 5 admittedly had no business for opposing the checkoff and has its only reason for such our opposition was to frustrate agreement with the union.

I know, but that’s not the question I’m putting.

Norton J. Come:

I think —

(Voice Overlap) that’s what I’m putting to use whether there was a finding, the affirmative reason, the real reason just as to weaken the position of the union.

And my next question was do you think you have given case where you can find such a finding?

Norton J. Come:

Well, I don’t think that the Board specifically found that the purpose was to weaken the union.

I think that that is the implicit in the finding that the sole purpose and only purpose was to frustrate in agreement because that has been necessary consequence of refusing to agree in bad faith over a period of five years as went on here.

I think that the history of why 8 (a) 5 was put into the Act shows that Congress recognized that was so to take put in an affirmative obligation to bargain in good faith because it was recognized by Senator Wagner and others that a mere obligation to recognize doesn’t mean anything unless there is a bar an obligation to bargain in good faith with the view to arriving in an agreement because if you don’t do that in good faith and try to coming on an agreement that is necessarily going to wear down the union and weaken it.

And that I think —

Going back to the question of Chief Justice asked you a little earlier as to practice issue, how does this frustrate the agreements?

(Inaudible)

Norton J. Come:

That is quite true.

However, the union is entitled to hold out for a checkoff so long as the employer is in bad faith refusing to give up on the checkoff.

Here, the employer, he’s not refusing a checkoff for a valid reason which he could do and if the union refuse to give up on the checkoff, that would be a frustrating if the agreement that would not be a violation of the statute.

But where the refusal to get an agreement is due to the employer’s bad faith refusal to give you the checkoff, then it is a refusal to bargain in good faith because what the employer is doing there is he is using the refusal to give you the checkoff really as a sham for not dealing with this union at all and that is what the noble this case is and the question —

Hugo L. Black:

May I ask you one question?

Warren E. Burger:

Mr. Black has a question.

Hugo L. Black:

I happen to know a man in Alabama who’s a big employer.

I have no doubt on this about why he would’ve objected.

He didn’t like the union.

He didn’t like to deal with it and he would rather surrender almost a bit that’s not the deal.

Now, I had no thought that the Board would have power to make him deal with them that way to certain terms.

They can make them bargain and negotiate it.

Now, I never thought of that Act as being anything more than one which is like the labor relations to let him on as far as you could lead him and when he got a daggers point to let him fight it out.

Norton J. Come:

Well, I think I —

William O. Douglas:

Let’s assume you could put the presence of this company in jail for civil contempt, for an indefinite period until he bargain if your findings that you all seem to agree upon are correct.

It has bad faith.

Norton J. Come:

And that’s why we feel that it’s a much more forthright thing for the Board to specifically tell the company in its order what it is that is needed to demonstrate his good faith.

That’s why the whole order here was made specific.

Norton J. Come:

Now, cut to come back to your example Justice Black.

I think that there’s no point —

Hugo L. Black:

I take it that man testified in this hearing?

Norton J. Come:

What’s that?

Hugo L. Black:

I would– may say that that man testified at this hearing I was talking about or the act and he testified against it.

Norton J. Come:

Well, I —

Hugo L. Black:

I don’t see how logically you’re right if we won the case to the end where the Government on a force an agreement not which would keep him strike, which the court give him in a lockout.

I agree as Justice Douglas asked you, you could try to contempt.

You put him in jail for contempt.

He has his word I don’t want to deal with unions.

And you say well, that’s not it if you just don’t want to make any contract at all.

And you get that finally on a bad basis to prosecute him in criminally, but I cannot see why accepting what you say because it seems to me here by and to decide in all (Inaudible) experience for a man who cross that way.

I’d say he just (Inaudible) around it’s a sham, it’s a sham.[Laughter Attempt]

But that’s a pretty, that’s a pretty thin ground on which a man to send a jail for contempt to, and that’s what it will finally come to.

Norton J. Come:

Well, I think that if you have to distinguish a hard bargaining case from a case that such as we have here only — there’s no question that has original proposition an employer doesn’t have to agree to proposals that the — just because of the union is making them I mean there’s plenty of room for good faith collective-bargaining even though that means that he end up at low overheads and the union has the option of either striking or the employer of lacking up.

That is not in this case, this is an employer —

Hugo L. Black:

Why is it?

Norton J. Come:

Well, on the findings of the Board that were affirmed by the Court of Appeals this is a case of an employer who is going through bargaining —

Hugo L. Black:

Intended to object on one ground when in reality it was objected on another and that’s the question you’d have to submit to a jury in a contempt case.

Norton J. Come:

But by making the requirement specific you avoid a contempt action with the – because the employer knows what he has —

Hugo L. Black:

I agree but Congress has yet said it want to go that far I’m afraid in connection with the employer is due just as it puts on (Voice Overlap).

Norton J. Come:

Your Honor I submit that this is a remedy problem for a very unusual type of situation and that —

Hugo L. Black:

Well, I would think it would be many.

Norton J. Come:

What’s that Your Honor?

Hugo L. Black:

I would think it would be many.

Norton J. Come:

No because in the usual situation, you cannot or you either find that there’s just been a hard bargaining or you will find that the — that if the employer has acted in good faith you cannot say from the record that further bargaining would be meaningless.

I mean he has not indicated as this employer has.

Hugo L. Black:

But there can no further bargaining because the Board has ordered that he has except the provision to which either both.

Norton J. Come:

Well, the Board has done that only because in his initial bargaining he indicated that he had no reason other than the invalid reason for opposing the checkoff.

Hugo L. Black:

I’m not criticizing.

Norton J. Come:

And that’s what this case —

Hugo L. Black:

What they want (Voice Overlap) is our proposition just like we are.

Norton J. Come:

Yes Your Honor.

Thank you.

Warren E. Burger:

Thank you Mr. Come.

Mr. Cohen.

Lawrence M. Cohen:

Mr. Chief Justice and may it please the Court.

We had initially filed the motion to leave to argue in 15 minutes which was granted but I see that some part of their time has been assumed.

Warren E. Burger:

Yes, you got about 10 minutes that is left I think.

Lawrence M. Cohen:

The company and the Chamber are here Mr. Chief Justice —

Hugo L. Black:

Whom do you represent?

George H. Cohen:

United Steelworkers of America, we’re the charging party for the National Labor Relations Board, Your Honor.

Warren E. Burger:

Counsel, if you run under pressure we will take that into account.

George H. Cohen:

Thank you, sir.

The company and the Chamber are here today not to challenge any of the findings or fact made by National Labor Relations Board not to question the fact that they were motivated by bad faith and refuse to enter into a collective-bargaining agreement and not to question whether or not in this particular case if the Board had the power to compel a concession.

This case was a proper exercise of that power.

The company and the Chamber are here on the bold face of legal proposition that irrespective of bad faith, irrespective of their recidivism, irrespective of all of these things.

The simple fact remains the Board lacks the power to compel them to exact a concession of the kind that was exacted in this case.

Now, in support of that legal position, the company and the Chamber have relied —

William O. Douglas:

Isn’t that the concession, is that actual?

George H. Cohen:

Compel an agreement — to compel an agreement, require an agreement or compel a concession.

I was using the word “exact” with compel.

William O. Douglas:

Is it concession knowing where you sign this agreement or else.

George H. Cohen:

No, I’m referring Your Honor to the statutory language of making a concession in the company’s view this was making them concede to something by having to execute it to the contract.

Warren E. Burger:

But the very word “concession” implies agreement however reluctant doesn’t it?

George H. Cohen:

It required an agreement of this nature.

I don’t think there’s any question about that.

Now, in support of this proposition, the company relies on what it looks to the statutory language of 8 (d) and the legislative history of 8 (d).

Now, we submit and we have dealt with this at length on our brief that 8 (d) was the setup and established to define more clearly what the statutory obligation to confer in good faith meant and the whole thrust of 8 (d) is conferring in good faith.

It is true that to the extent that Congress recognized that an employer who is bargaining in good faith is entitled to the freedom of contract principles.

George H. Cohen:

That employer who was bargaining in good faith cannot be compelled to make a concession and cannot be required to make an agreement.

That is the express statutory language and the legislative history is quite clear and that there’s no illusion whatsoever to the question of what about this employer who’s acting in bad faith, what Congress was disturbed about and what the language of the Section is addressed himself to is the question of the Board’s prior practice of having look into the reasonableness or unreasonableness of a company response to a union demand at the bargaining table and say, well, the union’s demand look fairly reasonable and therefore when the company responded negatively, that’s indicia of bad faith, that’s the practice that Congress was addressing itself.

That is not a situation we have here, there’s no argument being made by the Chamber or the company that the Board’s finding of fact namely that the company’s position with respect to dues checkoff was taken for the sole purpose of frustrating agreement transgress 8 (d).

The company isn’t arguing that the basic finding of a statutory violation here in anyway was precluded by 8 (d).

On the contrary, the company in effect is saying that we not withstanding our bad faith have been giving an (Inaudible) by the Congress in that this basic freedom of contract principle found in 8 (d) which are obviously are not entitled to under the little language of 8 (d) because we were not conferring in good faith.

Nonetheless, that language is imported and transformed over the 10 (c).

William J. Brennan, Jr.:

But Mr. Cohen, does that answer the problem for us even if you had no 8 (d) would this problem still?

George H. Cohen:

No.

Your Honor that doesn’t answer the problem first and we have addressed themselves to that in a brief and I will be delighted briefly to do so here.

But it seems that what we are saying here is we have a serious question whether or not a bad faith employer or bad faith any party has any right at all to rely on the statutory language of 8 (d).

We acknowledge however that not withstanding this foreclosure that there’s still is running through the Labor Act a basic policy of freedom of contract.

But of course as this Court said in the Machinist Local versus NLRB, when you look at the Act, there’s only one way to determine the National Labor policy, that’s not one section of the Act, that’s the entire Act.

And as a result of that fact, this Court on numerous instances has mandated an approach to remedy which in effect says many times we have to fashion competing, balancing, conflicting policies.

This is one such instance we say Mr. Justice Brennan.

This is an instance quite obviously and indeed the court below recognized this very fact.

William J. Brennan, Jr.:

And I suppose that it is an arguable that because of the basic premise of regulation to bring about collective bargaining ought to leave the terms of the agreement to the parties are also — will be the agreement.

If that is essentially the basis of the — behind the legislation then that doesn’t raise the question whether on that circumstance, the Board can assert this problem, Mr. Cohen.

George H. Cohen:

I think I would respond by saying when you say “but to leave the substantive terms to the parties.”

This is always on the assumption that we have people who are in good faith trying to arrive at the collective-bargaining agreement.

This is and this is what was recognized by the court below and they said, we recognized that is here a minor intrusion into the freedom of contract even if the employer is —

William J. Brennan, Jr.:

Well, I should go a little beyond that.

What I was trying to suggest was that others have to do deliberation decided that Government was not going to write labor contract and it wasn’t going to allow any agents of the Government proscribe so (Inaudible)?

George H. Cohen:

Well, that —

William J. Brennan, Jr.:

Now, if that so then I would suppose that’s very powerful argument that the Board can assert in the problem.

George H. Cohen:

Well, that language I believe, that holds segment of the legislative history which you have so ably referred to in Insurance Agents.

That all, I repeat presupposes a good faith bargaining posture.

Now, there is nothing in the legislative history when we transpose it into look at 10 (c).

The Board is empowered with the broad authority to effectuate the policies of the Act.

Now, when Mr. Justice Black at an earlier time the hearing raised the question of, is there anything in the legislative history that points the giving the Board this power.

I think the answer is twofold.

George H. Cohen:

Obviously, 8 (d) didn’t addressed itself to this problem because 8 (d) presuppose good faith bargaining but in 10 (c), numerous congressmen got up and said, now, what kinds of problems are going to be confronted to the Labor Board and how can we delineate what their authority should be in remedying those problems.

And the Congress came to the conclusion and this Court has referred to this fact in many of their decisions Sever-up Bottling, Phelps Dodge, there is an enormous amalgam of potential problems, very bold depending on the facts of every case.

What we are going to do is empower the Board to issue what affirmative action it believes will effectuate the policies of the Act.

Obviously, that is not unreviewable unlimited discretion, but it is a basic discretion and indirectly I would submit to you.

It addressed itself to the type of problem that you are speaking about.

I would say indirectly in 10 (c), there is always the possibility that the Board could issue an order of that sort that it issued here.

And what we say is the —

Hugo L. Black:

May I — I thought you’re arguing on the other side?

George H. Cohen:

No, Your Honor.

Hugo L. Black:

Are you arguing against the Board’s order or Court’s order?

George H. Cohen:

No, I’m arguing for the Board’s order and I’m suggesting that the Board discretion that the Congress left would be NLRB in Section 10 (c) supports the issuance of a remedy that was issued in this particular case.

It involved the problem having to fashion and compete conflicting policies.

Hugo L. Black:

Are you concurring the Act?

Who the sole giving to the Board dealt five conditions, are you — it must be accept?

George H. Cohen:

No Your Honor I’m not but I am — what I’m saying is 10 (c) empowers the Board to take the effective action that is necessary to remedy the particular violation found in giving case.

Hugo L. Black:

Well, do you think if remedy is necessary to tell people they got to sign a contract with that power?

George H. Cohen:

There could certainly be a situation where a — this is happened numerous times before this case so yes Your Honor but there’s been a violation found.

Let’s talk in terms of —

Hugo L. Black:

But I say the violation is that they just stick to one view and they won’t leave it five years.

What is your opinion on that?

George H. Cohen:

You mean are they bargaining in bad faith that we got a basic finding of bad-faith bargaining when you say stick to one —

Hugo L. Black:

Do you mean then that if the Board finds a reasonable fact, reasonable support theory that the man really is not interested in against union’s checkoff but then they can force him to sign a checkoff provision?

George H. Cohen:

Well, the mere fact that an interest that they are not interested, I don’t think it would be determined.

I think this case highlights that problem.

Here, is an employer who — for the sole purpose of frustrating agreement over this five-year period took a position on dues checkoff.

He went to the union jaggedly.

He knew this is what the union wanted, he made the judgment that he was not going to execute an agreement and he was going to use dues checkoff as a device to frustrate reaching an agreement.

But we had something beyond that year because not only was he using it as a device to frustrate agreements, he went on to acknowledge that he had no possible conceivable legitimate purpose for refusing to grant the checkoff.

Hugo L. Black:

He did?

George H. Cohen:

In this case, yes Your Honor.

George H. Cohen:

He acknowledged that there was no administrative inconvenience indeed he had been checking off —

Hugo L. Black:

Sure thing but he was against it?

George H. Cohen:

He was against it — he was against it for a bad faith purpose of frustrating collective-bargaining that was the key to the finding.

Hugo L. Black:

Well, suppose the union have been bucking, it said, we don’t want the checkoff, we want to collect that money out of sales appear to word, is that compare?

George H. Cohen:

If it could be demonstrated that we had no bad faith on either side of table then we wouldn’t have a violation that we wouldn’t be involved in these remedies (Voice Overlap).

Hugo L. Black:

How are going to be able to demonstrate bad faith so that you can read it real loud as not to put a man in jail for contempt to court?

George H. Cohen:

Well, bad faith has we all acknowledged and we realized when it was written into the statute is a subjective standard but nevertheless, it is one of the basic course of the entire Labor Act.

It is true that it requires the determination of what was the employer’s motivation but as you indicated earlier today let’s assume that an employer setout with the purpose to frustrate reaching an agreement, but he had to make a judgment.

How I’ll going to keep from reaching an agreement with this union?

I’ll look to what one of their key where that key demand us and I’ll use that.

I’ll use that as the device to foreclose reaching an agreement and that’s exactly what happened here.

The company —

Warren E. Burger:

The counsel this morning Mr. Cohen mentioned that the union come witness for speaking for the union said, they would never agree to agreement without a checkoff, is that in the record something like that?

George H. Cohen:

I believe it is clearly in the record that the union was insisting on a dues checkoff provision.

Warren E. Burger:

And they would not sign a contract without it?

George H. Cohen:

I don’t know of those specific words —

Warren E. Burger:

Let’s assume for the moment whoever said that was accurate, would you think that was in adamancy (Voice Overlap) —

George H. Cohen:

Absolutely, but the key distinguishing factor Mr. Chief Justice is nothing under this Act to preclude a party from adamantly in good faith insisting on a particular bargaining position.

No one has suggested to the contrary, the key thing that distinguishes this particular case and in a sense you referred to it in your dissent in Ronald was the crucial finding that it was bad faith that motivated this employer.

He chose to pick the dues checkoff issue as his device to frustrate reaching the agreement.

Warren E. Burger:

Well, you’re then doing on the same theory that Mr. Come suggested that a bargainer is always obliges to state all of his reasons (Voice Overlaps) —

George H. Cohen:

That is not the problem that we have before us Your Honor.

This is not a question of being — of standing forth forward ones position.

This is a case (Voice Overlaps) and we say it was a finding.

Warren E. Burger:

The reasons I’m talking about the reasons for the position.

I have thought it was the essence of the bargaining that you are not obliged to disclose all your reasons and to think (Voice Overlap).

George H. Cohen:

The essence of bargaining is I’m sure you are well aware is to behave in a manner consistent with the good faith requirement of the statute and where that finding is made as it was made here and where this company has put themselves into this box where they were using the checkoff to frustrate reaching an agreement.

And indeed had no legitimate reason, we say that would be inappropriate remedy in this particular case.

Warren E. Burger:

Let me pursue the question on 10 (c) that you mentioned —

George H. Cohen:

Yes, Your Honor.

Warren E. Burger:

— the latter part of 10 (c) where the statute discusses under what circumstances where it says, and to take such affirmative action including reinstatement of employees with or without bad faith.

Now, I would assume you would agree that the drastic remedy applied here is something more stringent than a command signed a particular contract.

Wouldn’t you think that if Congress intended to include any such provision as a command to agree in a particular clause they would’ve listed that in this statute?

George H. Cohen:

Well, I would answer that by saying this, I don’t — as a so often the case, the legislative history of statutes don’t communicate there are the legislature’s concern with every potential problem that could have been post.

And I think quite the contrary that Congress intentionally left 10 (c) framed in a very broad terms that was framed namely as will effectuate the policies of the Act because they recognized that they’re were going to be on entirely difficult number of situations that were going to come up and they didn’t want to confine the agency that was administering the statute to one limited or two or three specified remedies.

But I think —

Warren E. Burger:

I think your time is up now Mr. Cohen if you got to close.

Hugo L. Black:

Before you close, I like to say I had the (Inaudible) comment said Mr. Cohen representing the Chamber of Commerce and that’s acted and (Voice Overlaps) —

George H. Cohen:

Well, Your Honor we have an extra ordinarily unique situation there is a Mr. Cohen represented Chamber of Commerce.

Hugo L. Black:

But either is?

Warren E. Burger:

We have two, you should get along better.[Laughing]

Donald C. Winson:

Mr. Chief Justice, I understand from the marshal we have a couple of minutes left here.

Warren E. Burger:

That’s right you have — Mr. marshal will you indicate it?

Eleven minutes.

Donald C. Winson:

Thank you very much I’ll just take couple of those minutes if I may to answer the question that was post a minute ago, the record does show that the union adequately insist upon a dues checkoff provision and although I couldn’t quickly find the record reference Judge Miller in his dissenting opinion in the Court of Appeals refers to what even to the extent that the counsel for the Board’s general counsel told the Examiner that his own inquiry showed that the union would not sign a contract without a dues checkoff provision.

There have been references now throughout the briefs in the argument —

Hugo L. Black:

What if they went odd.

There was odd, one of them said, I won’t do it if it’s in there; and the other one said, I won’t do it unless it isn’t.

Donald C. Winson:

That’s right Mr. Justice Black and the company was found to a bargain of bad faith for the purpose of frustrating an agreement.

Incidentally, that raises a question of whether it’s a mandatory subject and then somebody said it never been raise.

In the earlier proceedings before the Court of Appeals, we did argue that where we were not convinced that at that time I’m not personally not convince now that it is a mandatory subject.

But obviously it was not something to be raise in this proceeding before this Court.

So we have not — do not have this as an issue right now, but there have been references characterizing this case in a number in different ways now.

As we mentioned earlier, the union in its brief talks of this that this remedy that they’re after here could not be use is a Ronald case.

The Court of Appeals said that in ordering a checkoff is only a minor intrusion on agreement contract.

Now, today, it said that this is a unique situation.

Well, as Judge Miller in his dissenting opinion initially on the merits of this case, he concluded by saying that he never seen case so barren of support for the bad faith finding found by the Examiner and adopted by the Board.

Now, we’re not here to argue the facts obviously but all I’m saying is that for anybody to say this case is unique or this or that case is where the Miller, that’s always a decision that has to be made their people when you disagree.

Congress in its wisdom did not, and nobody has cited any authority that Congress empower the Board to decide on the basis of characterizing cases whether it can order agreement or whether it couldn’t.

Counsel for the Board argued today when asked the question, well, where do we draw the line, where do you suggest we draw the line?

Donald C. Winson:

He said this about the present case where he says that it’s within the imaginary line.

Here, there was a bargaining in bad faith.

Well, there’s a bargaining in bad faith in every case you don’t approach the remedy.

The question of 8 (a) 5 remedy unless there’s bad faith bargaining.

He said there was no business or legitimate reason.

I know of no law I don’t think there’s law right now to the extent that you have to have a business reason.

I don’t think our law has approach that point and I suggest to that is probably an important issue now or an important consideration in this case whether business reasons are or not needed.

The third thing, he said was a checkoff provision as cut-and-dry.

Well, I wonder sometimes whether a checkoff is cut-and dry.

It can affect other provisions, it can affect the wage provisions for example obviously if the union wants the checkoff provision badly enough, they’re going to give up 2 cents an hour to get it or 3 cents what have you.

So I suggest that these two considerations that have been brought forth today are exactly in the character of the Congress told the Board to stay away from in 8 (a) 5 and that is a sitting in judgment on whether the case is unique, whether it’s cu-and-dry, whether there were good reasons for refusing the provision.

I suggest this, I would conclude with the point from the Chamber’s brief of footnote.

It pointed out that be sitting here today that this question of Board intrusion in the bargaining process did not come anew in 1947.

I’m referred to the legislative history back with the National Labor Relations Act of 1935 and the is footnote on page 5 of the Chamber’s brief where Senator Wolf, chairman of the Committee in Education and Labor said that nothing in this Bill allows the federal government or any agency to fix wages, regulates rates of pay and so forth.

There is nothing in this Bill that compels any employer to make any agreement about wages, hours, employment or working conditions.

I merely suggest that this treat of freedom of contract in the basic premise throughout the Act Section 8 (d) is the focal point by which is brought forth but this basic premise is there the Court of Appeals did not deny it.

The Board and the union in our brief do not deny.

Instead, they say that they should be allowed to agree whenever the intrusion of freedom contract is only minor.

Thank you.

Warren E. Burger:

Thank you Mr. Winson.

Thank you for your submission gentlemen.

The case is submitted.