The Taft-Hartley Act and Multi-employer Bargaining [Reprint 2016 ed.] 9781512816068

Citation preview

The

T A F T - H A R T L E Y ACT and

MULTI-EMPLOYER BARGAINING

By Jesse Freidin

Published for the LABOR RELATIONS COUNCIL of the WHARTON SCHOOL OF FINANCE AND COMMERCE by the

UNIVERSITY

OF

PENNSYLVANIA

Philadelphia 1948

PRESS

Copyright 1948 UNIVERSITY OP PENNSYLVANIA PRESS Manufactured in the United States of America

Jesse Preidin is engaged in the practice of law in New York City as a partner of Poletti, Diamond, Freidin and Mackay. He was formerly Associate General Counsel, General Counsel, and Public Member of the National War Labor Board.

Preface

During its extended consideration of the essential elements of a new national labor policy in 1947, the Congress was stronglyurged to outlaw altogether or drastically to restrict the practice of industry-wide or multi-employer collective bargaining. As a matter of fact, the House of Representatives voted overwhelmingly to impose severe restrictions upon multi-employer bargaining. Such restrictions as appeared in the labor control bill of the House were opposed by many employers as well as by most unions. They were eliminated by the Joint Conference Committee which reported out the bill which became the Labor-Management Relations Act, 1947. But the question of whether or not there should be legislative regulation of multi-employer bargaining is far from a closed issue. The Joint Committee on Labor-Management Relations, created by Section 401 of the Taft-Hartley Act, was charged with the responsibility, among numerous others, of studying and investigating "the methods and procedures for best carrying out the collective bargaining processes, with special attention to the effects of industry-wide or regional bargaining upon the national economy." Altogether too frequently, proposals for legislation in this area are not closely related to the actual labor relations problems which exist. For example, multi-employer bargaining has become associated with the power of a national union to fix industry-wide wage policies and to strike an entire industry in order to effectuate such policies. But the regulation of the bargaining practice may not provide the results expected. As Jesse Freidin so cogently states, the idea that "the power of big unions would be effectively limited were collective bargaining to be conducted on the singleplant or local-area level has a deceptive simplicity and may stem from a possible mistaken juxtaposition of cause and effect." Jesse Freidin's study entitled "The Taft-Hartley Act and Multi-Employer Bargaining" has many notable passages, such as the one just noted, which point out the complexities that arise when the government seeks to legislate rules and regulations governing [iii]

industry-wide collective bargaining. By bridging the gap between legal techniques and industrial relations necessities, Jesse Freidin has made a great accomplishment in this study. One further contribution of the study should be mentioned. Although the Taft-Hartley Act does not directly regulate industrywide collective bargaining, a number of its provisions do have significant effects upon this form of joint relationship. The author believes that many of these effects may have been unintended. A t any event, they should not be overlooked at a time when the Congressional Joint Committee on Labor-Management Relations has embarked upon a comprehensive study of industry-wide bargaining as a basis for determining whether recommendations for further legislation should be made. The real nature and significance of legislation now on the books should be the starting point in evaluating the need for additional regulation of industry-wide bargaining. GEORGE W .

Philadelphia August 3, 1948

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TAYLOR

I

The Taft-Hartley Act and Multi - Employer Bargaining The Problem of Variable Bargaining

Relationships

C

OLLECTIVE bargaining between designated representatives of a group of employers, on the one hand, and the employees of all employers within the group, on the other, has taken no fixed form. Sometimes, notably in Sweden and Great Britain, it has encompassed an entire industry. Most often in this country, however, it has been conducted either by a group of employers whose operations are concentrated within a given region or by a group of employers who, though geographically scattered, have an established competitive relationship and are recognized within their industry as wage leaders. It sometimes covers all terms of the labor agreement, sometimes only basic terms of wages and hours, leaving many details for local negotiation. Occasionally, as in pottery, flint glass, and stoves, it undertakes to deal only with wages for a few important occupations. It varies in the extent to which it seeks to establish wage uniformity—some agreements provide for it, others recognize differentials based on a variety of factors. It has on occasion received impetus from the union seeking a convenience in collective bargaining; in other situations the employers have, on their own initiative, developed group bargaining as a defense against the growing power of a nationally organized union. Multi-employer bargaining is, in other words, not a generic term having a fixed meaning and taking an inflexible form; on the contrary, it is a practical technique of collective bargaining that has been adapted with marked success to meet the particular problems of individual cases. But in its potential effect on the growth of this bargaining technique, the Labor-Management Relations Act of 19471 has taken no account of the many differences in form, purpose, extent, or

1

Pub.

L. No. lot, 80th Cong., 1st Sess.: 29 U.S.C.A. 141 et seq.

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origin. The legal effects of the act upon the establishment of bargaining units composed of the employees of more than one employer appear to be identical. Consequently, in the discussion to follow, the references to multi-employer bargaining are intended to include all the wide variety of forms which that technique is capable of taking. Many of the effects of the new act on this problem were, it is believed, unintended. They will have come about not so much as the result of positive congressional intent as of the compelling force of the language of some of the amendments which, while directed to different problems, appear to have unavoidable application to the subject under discussion. This is not true, however, of the efforts made during the course of the bill's passage through Congress to deal directly with multi-employer bargaining. • It will be of some interest, prior to examining the act as finally adopted, to look at some of the restrictions which, since Congress considered and rejected them, we are entitled to assume will have no place in the administration of the act. The broadest of the proposed restrictions was that offered by the National Association of Manufacturers. It would have made it illegal for " a union or unions representing the workers of two or more employers to take joint wage action or engage in other monopolistic practices." The scope of this prohibition would have depended upon the view of the courts as to what constituted "joint wage action" or "other monopolistic practices"; whether it referred, for example, to consultation among two or more local unions as to the wage demands they would make upon competing employers, or only to the formulation by a national organization, composed of constituent locals, of a wage demand from which the locals would have no authority to depart. Or whether use of the word "action" indicated that the ban was not to apply to the making of policy but only to efforts to enforce by coordinated strike action, identical wage demands made upon a number of employers. Senator Ball's proposal was not so broad. It would have permitted multi-employer bargaining within a single labor market area, so long as the area did not include places of employment separated by more than 100 miles. Why the line was drawn at 100 miles does not appear. Nor is it known whether the bill would have applied to existing multi-employer bargaining practices or was to be limited only to new situations. Again, it was uncertain whether the prohibition would have extended to multiple-plant [2]

bargaining where widely separated plants of the same employer are covered by a master contract. 2 Section 9 ( f ) of the House bill would have prevented the National Labor Relations Board, with certain exceptions, from certifying as the representative of employees of one employer a representative that had been certified as the representative of employees of a competing employer. This would effectively have precluded the establishment of a multi-employer unit but would not, as the Conference Committee seems to have erroneously assumed, have outlawed bargaining on a multi-employer base, for the latter, as a practical matter, does not need to rest upon the establishment of an identical bargaining unit. 2

D u r i n g the discussion of S e n a t o r Ball's proposal, S e n a t o r T a f t stated t h a t he did n o t t h i n k it would a p p l y t o a u n i t composed of scattered p l a n t s of a single employer.

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II The Problem of Concentrated Union Power HESE brief references to proposed bans or restrictions on multi-employer bargaining illustrate a wholly understandable tendency to confuse with that process, no matter how broad or narrow its base, the power of a national union to promulgate uniform policy and to shut down an entire industry, or a significant part of an industry, in an effort to effectuate the policy. For it seems apparent that Congress concerned itself with multi-employer bargaining chiefly as a means of getting at concentrations of union power in such nationally organized industries as steel, coal, automobiles, and communication and in the ability such amalgams of power give to a handful of unions to shut down major segments of the economy. Regulation of big unions3 and limitation of their exercise of power seem basically to have been the real issues; multiemployer bargaining, only a convenient avenue for approaching the problem.

T

The notion that the power of the big unions would be effectively limited were collective bargaining to be conducted on the single-plant or local-area level4 had a deceptive simplicity and may stem from a possible mistaken juxtaposition of cause and effect. The assumption that group-employer bargaining is responsible for the bigness and the power of unions appears contrary to experience. The fact seems to be that the formation of employer organiza8A

revitalization of Mr. Justice Brandeis' abhorrence for "bigness," this time directed against labor unions, and the emphasis placed by other provisions of the new act upon the interests of individual employees and smaller units are sociological factors which also must be assumed to have played a part in shaping the views of the proponents of the ban on gToup bargaining. * It is interesting to look back, in this connection, to the report of the Industrial Commission to the Congress of 1902, which emphasized the value of unions organized on a national rather than a local scale: "The local union sees its little grievance, presses its complaint with growing anger, and is tempted to rush into the last extremities of labor conflict. The national officer is able in some degree to see the force of the opposite contention, and, still more important, is able to form a rational judgment of what the circumstances may make it possible to do. His counsel, therefore, is likely to be opposed to those hasty, rash and hopeless strikes which make up so large a fraction of the whole number of labor contests. The national organizations also tend to diminish the number of labor contests through the rules and regulations by which they restrain the action of the locals." ( H . R. Doc. No. S80, 57th Cong., 1st Sess., 1902, p. 797.) To the same effect was the 1915 report to the Congress of the Commission on Industrial Relations: . . to suggest that labor unions can be effective if organized on less than a national scale seems to ignore entirely the facts and trend of present-day American business." Comm. on IiH'istrial Relations (created by the Act of Aug. 23, 1912), Final Report, Sen. Doc. No. ill, 64th Cong., 1st Sess., 1916, p. 65.

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tions is, in large part, a defensive response to the organized and established power of large unions.5 And it appears very likely that to outlaw group-employer bargaining would simply have the effect of depriving employers of a mechanism they have found effective in dealing with the bigness of unions without in any substantial way reducing the power to shut down an industry implicit in such bigness. Consider, for example, some of the complex problems that would have been bound to arise in the enforcement of any prohibition on multi-employer bargaining if its calculated objective of avoiding industry-wide strikes were to be achieved. Would it have been a violation of the law for autonomous local unions to insist independently upon similar terms in their contracts with individual employers? Could the law have been interpreted or administered to preclude identical or near-identical expiration dates? For if contracts, even though between autonomous unions and individual employers, were to expire contemporaneously, or to overlap in their expiration dates, how could disagreement throughout a highly organized industry, and the consequent threat of strike, be avoided? Would the law have prevented consultation among employers bargaining with the same union? In acting upon charges of alleged violation of the law, what evidentiary value was to have been attached to identical terms embodied in independently reached agreements, or to strikes that occurred, without any connivance, over disagreement on identical demands from separate locals? How different would union demands have been required to be in order to be free of a charge that the unions involved were subject to common control? Would the prohibition have been effective with respect to several plants of the same employer where, because of the combined productive capacity of the plants, a stoppage might cripple an industry as effectively as would an industry strike? Would an international union or a group of unrelated unions have been prevented from contributing to a strike fund or from respecting picket lines? Would unified action 5"The

c b i - f advar.tp.irea of national or regional b a r g a i n i n g from the point of view of employers also ari"e f r o m the substantial equality in wage s c a l e s ; stabilization of costs in the industry, elinv'.iation of pare peitii