National Labor Relations Board v. Action Automotive, Inc.

PETITIONER: National Labor Relations Board
RESPONDENT: Action Automotive, Inc.
LOCATION: United States District Court House

DOCKET NO.: 83-1416
DECIDED BY: Burger Court (1981-1986)
LOWER COURT: United States Court of Appeals for the Sixth Circuit

CITATION: 469 US 490 (1985)
ARGUED: Oct 29, 1984
DECIDED: Feb 19, 1985

Norton J. Come - on behalf of Petitioner
Stewart J. Katz - on behalf of Respondent

Facts of the case


Media for National Labor Relations Board v. Action Automotive, Inc.

Audio Transcription for Oral Argument - October 29, 1984 in National Labor Relations Board v. Action Automotive, Inc.

Warren E. Burger:

Mr. Come, I think you may proceed when you are ready.

Norton J. Come:

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

The question presented in this case is whether the National Labor Relations Board has authority under Section 9(b) of the Act which gives the Board broad discretion in regard to establishing units appropriate for collective bargaining, to exclude from a bargaining unit employees who are close relatives of the owners of a closely held corporation that employs them without a showing that the employee relatives receive special job-related privilege.

The basic facts are these.

Respondent is an automobile parts and gasoline dealer in Michigan.

The dealership, a closely held corporation, is owned equally by three brothers, Richard, Robert and James Sabo, who are President, Vice President, and Secretary-Treasurer respectively.

The three Sabo brothers are actively involved in Respondent's daily operations; together they make all of its policy decisions and retain ultimate responsibility for the supervision of all of its partners.

In March of 1981 the Retail Employees Union filed a petition with the Board requesting that a representation election be held among Respondent's employees.

Respondent from the union stipulated to an election in two bargaining units, a unit of store and warehouse employees at Respondent's nine retail stores, and a unit of office clerical employees at Respondent's headquarters office.

The union received a plurality of the votes in the election, but the validity of its certification as the bargaining representative for both of these units turns on the validity of the Board's action in sustaining the challenges to the ballots of Diane and Mildred Sabo.

Diane is the wife of Respondent's President Richard Sabo.

She is a regular part time general ledger clerk at the headquarters office.

She resides with her husband, and both work at the same office.

At work she often goes to lunch with her husband, or one or both of his brothers.

Mildred Sabo, the mother of the three Sabo brothers who own and operate Respondent, is a full time cashier at one of the retail stores.

She lives with Secretary-Treasurer James Sabo in a house that he owns, and she sees or has contact with her other sons and their families on a regular basis.

The Board, applying its longstanding policy of excluding close relatives of the owners of a closely held corporation from bargaining units where the family relationship is such as to remove the employee relative from the community of interests shared with other employees, concluded that Diane and Mildred Sabo should be excluded from the bargaining unit because in view of their relationship to Respondent's owners, their interests were more closely allied with management than with the other employees.

William H. Rehnquist:

Mr. Come?

Norton J. Come:

Yes, sir.

William H. Rehnquist:

Has the Board ever explained the relationship between Section 152(3) of the Act, where Congress says that the term 159(b) to decide that close relatives shan't be members of a bargaining unit?

I would think there is an argument there that Congress has already spoken to this subject and it has not gone as far as the Board has.

Norton J. Come:

That was the basis on which the Sixth Circuit refused to enforced the Board's order.

It felt constrained by Section 2(3) of the statute which excludes from the definition of employee any individual employed by his parent or spouse, which... it is the Board's position that this provision which goes back to the Wagner Act days simply defined the relatives of employers of... who are wholly outside of the Act's protection.

It says nothing about how the Board should exercise its discretion in determining appropriate units with respect to relatives who are employees within the Act's coverage.

Sandra Day O'Connor:

But Mr. Come, the Board is relying on Section 9(b) authority, and 9(b) speaks in terms of selection of an employer unit, a craft unit, a plant unit, or a subdivision, and it just doesn't address itself to picking out individuals, does it?

Norton J. Come:

No, it does not.

However, the Board from its earliest days, in defining units under Section 9(b), has used a community of interest standard.

The purpose in defining the unit under that standard is to put together groupings of employees that have a unity of economic interests and try to exclude employees that do not share.

Sandra Day O'Connor:

Well, is it the Board's position that it could employ a standard that would exclude individuals simply based on anti-union animus alone?

Norton J. Come:

No, Your Honor, that is--