U.S. Supreme Court CONSOLIDATED EDISON CO. v. NATIONAL LABOR RELATIONS BD., 305 U.S. 197 (1938)

305 U.S. 197

CONSOLIDATED EDISON CO. OF NEW YORK, Inc. et al. v. NATIONAL LABOR RELATIONS BOARD et al.

INTERNATIONAL BROTHERHOOD OF ELECTRICAL WORKERS et al. v. SAME.

Nos. 19, 25. Argued Oct. 12-17, 1938. Decided Dec. 5, 1938.[ Consolidated Edison Co. v. National Labor

[Page 305 U.S. 197, 218]

ganization for the purpose of collective bargaining and would not be subject to discharge or to any discrimination by reason of their choice. 4 N.L.R.B. 71.

It appeared that between May 28, 1937, and June 16, 1937, the companies had entered into agreements with the International Brotherhood of Electrical Workers and its local unions, providing for the recognition of the Brotherhood as the collective bargaining agency for those employees who were its members, and containing various stipulations as to hours, working conditions, wages, etc., and for arbitration in the event of disputes. The Board found that these contracts were executed under such circumstances that they were invalid and required the companies to desist from giving them effect. Id. At the same time the Board decided that the companies had not engaged in unfair labor practices within the meaning of Section 8(2) of the Act. [Footnote 2] That clause makes it an unfair labor practice to 'dominate or interfere with the formation or administration of any labor organization or contribute financial or other support to it'. Accordingly the order dismissed the complaint, so far as it alleged a violation of Section 8(2), without prejudice. Id.

[Page 305 U.S. 197, 245]

to desist from giving effect to the Brotherhood contracts, as provided in subdivision (f) of paragraph one of the Board's order.' In that paragraph the petitioner companies are ordered to: 'I. Cease and desist from: '(f) Giving effect to their contracts with the International Brotherhood of Electrical Workers.'

It is agreed that the 'fundamental purpose of the Act is to protect interstate and foreign commerce from interruptions and obstructions caused by industrial strife.' This is to be accomplished by contracts with labor organizations, reached through collective bargaining. The labor organizations in turn are to be created through the self-organization of workers, free from interference, restraint or coercion of the employer. [Footnote 1] The forbidden interference is an unfair labor practice, which the Board, exclusively, is empowered to prevent by such negative and affirmative action as will effectuate the policies of the Act. 2 To interpret the Act to mean that the Board is without power to nullify advantages obtained by the Edison companies through contracts with unions, partly developed by the unlawful interference of the Edison companies with self-organization, is to withdraw from the Board the specific authority granted by the Act to take affirmative action to protect the workers' right of self-organization, the basic privilege guaranteed by the Act. Freedom from employer domination flows from freedom in self-organization.

[Page 305 U.S. 197, 246]

The Board found that the Consolidated Edison Company and its affiliates, the respondents before the Board, 'deliberately embarked upon an unlawful course of conduct, as described above, which enabled them to impose the I.B.E.W. upon their employees as their bargaining representative and at the same time discourage and weaken the United which they opposed. From the outset the respondents contemplated the execution of contracts with the I.B.E.W. locals which would consummate and perpetuate their plainly illegal course of conduct in interfering with, restraining, and coercing their employees in the exercise of the rights guaranteed to them under Section 7 of the Act. It is clear that the granting of the contracts to the I.B.E.W. by the respondents was a part of the respondents' unlawful course of conduct and as such constituted an interference with the rights of their employees to self-organization. The contracts were executed under such circumstances that they are invalid, notwithstanding that they are in express terms applicable only to members of the I.B.E.W. locals. If the contracts are susceptible of the construction placed upon them by the respondents, namely, that they were exclusive collective bargaining agreements, then, a fortiori, they are invalid.' [Footnote 3]

[Page 305 U.S. 197, 247]

establishment of locals and by permitting solicitation of employees on the time and premises of the Edison companies. By the Wagner Act employees have 'the right to self-organization.' It is an 'unfair labor practice for an employer' to 'interfere with, restrain, or coerce employees' in the exercise of that right. [Footnote 4] The Board concluded that the contracts with the I. B.E.W. unions were a part of a systematic violation by the Edison companies of the workers' right to self-organization.

[Page 305 U.S. 197, 248]

assumption to say that none of the 30,000 members 'joined voluntarily'; and that the 'employers' practices, which were complained of, could be stopped without imperiling the interests of those who for all that appears had exercised freely their right of choice.' 6 On the question whether or not the Edison companies' activities as to these contracts were a part of a definite plan to interfere with the right of self-organization, these answers are immaterial. It is suggested that the problem of the contracts should be approached with three cardinal considerations in mind: (1) that one contracting party is an 'independently established' labor organization, free of domination by the employer; (2) that the contracts grant valuable collective bargaining rights; and (3) that they contain provisions for desirable working privileges. Such considerations should affect discretion in shaping the proper remedy. They are negligible in determining the power of the Board. They would, if given weight, permit paternalism to be substituted for self-organization. The findings of the Board, based on substantial evidence, are conclusive. [Footnote 7] There was evidence of coercion and interference, and the Board did determine that the policies of the Act would be effectuated by requiring the companies to cease giving effect to these contracts.

[Page 305 U.S. 197, 249]

This case determined that where an employer has created and fostered a labor organization of employees, thus interfering with their right to self- organization, the employer can be required without notice to the organization, to withdraw all recognition of such organization as the representative of its employees. It is said that this case 'is not apposite, as there no question of contract between employer and employee was involved. The Board had found upon evidence that the employer had created and fostered the labor organization in question and dominated its administration in violation of Section 8(2).'8 In the instant case it was found that no such domination existed. In the Greyhound Case, the Board found not only domination under Sec. 8(2) but also, as in this case, an unfair labor practice under Sec. 8(1). The company's violation of Sec. 8(1) was predicated on its interference with self-organization. [Footnote 9] In the Greyhound Case it was said that the organization was not entitled to notice and hearing because 'the order did not run against the Association.' 10 Here the unions are affected by the action on the contracts, exactly as the labor organization in the Greyhound Case was affected by the order to withdraw recognition. It would seem immaterial whether those contracts were violative of one or both or all the prohibited unfair labor practices.

[Page 305 U.S. 197, 250]

tation of membership during company time, and paying overtime allowances to those engaged in soliciting or coercing workers to join the contracting unions. The complaint said that similar aid was not extended to a competing union and that office assistance was given to the effort to get members for the contracting unions. These charges made it obvious that the contracts were obtained from the unions which were improperly aided by the Edison companies in violation of the prohibitions against interference with self-organization. Contracts so obtained were necessarily at issue in an examination of the acts in question.

Certainly the Edison companies and the contracting unions could have been allowed on a proper showing a further hearing on the question of the companies continuing recognition of the contracts. By section 10(f) the Edison companies and the unions could obtain a review of the Board's order. In that hearing either or both could show to the court (Sec. 10(e)) that additional evidence as to the contracts was material and that it had not been presented because the aggrieved parties had not understood that the contracts were subject to a cease and desist order or had not known of the proceeding. The court could order the Board to take the additional evidence. This simple practice was not followed. Although all parties were before the lower court on the review, the petitioners chose to rely on the impotency of the Board to enter an order affecting the contracts.

In these circumstances the provision of the order requiring the Edison companies to cease from giving effect to their contracts with the contracting unions is proper. This order prevents the Edision companies from reaping an advantage from those acts of interference found illegal by the Board.

Mr. Justice BLACK concurs in this opinion. Footnotes

Footnote 1 49 Stat. 449; 29 U.S.C. 158(1)(3), 29 U.S.C.A. 158(1, 3).

Footnote 2 29 U.S.C. 158(2), 29 U.S.C.A. 158(2).

Footnote 3 29 U.S.C. 160(a), 29 U.S.C.A. 160(a).

Footnote 4 New York State Labor Relations Act, 715.

Footnote 5 29 U.S.C. 160(e)(f), 29 U.S.C.A. 160(e, f).

Footnote 6 Rules 37 and 38 are as follows.'Sec. 37. Whenever the Board deems it necessary in order to effectuate the purposes of the Act, it may permit a charge to be filed with it, in Washington, D.C., or may, at any time after a charge has been filed with a Regional Director pursuant to Section 2 of this Article, order that such charge, and any proceeding which may have been instituted in respect thereto-'(a) be transferred to and continued before it, for the purpose of consolidation with any proceeding which may have been instituted by the Board, or for any other purpose; or'(b) be consolidated for the purpose of hearing, or for any other purpose, with any other proceeding which may have been instituted in the same region; or'(c) be transferred to and continued in any other Region, for the purpose of consolidation with any proceeding which may have been instituted in or transferred to such other Region, or for any other purpose.'The provisions of Sections 3 to 31, inclusive, of this Article shall, in so far as applicable, apply to proceedings before the Board pursuant to this Section, and the powers granted to Regional Directors in such provisions shall, for the purpose of this Section, be reserved to and exercised by the Board. After the transfer of any charge and any proceeding which may have been instituted in respect thereto from one Region to another pursuant to this Section, the provisions of Sections 3 to 36, inclusive, of this Article, shall apply to such charge and such proceeding as if the charge had originally been filed in the Region to which the transfer is made.'Sec. 38. After a hearing for the purpose of taking evidence upon the complaint in any proceeding over which the Board has assumed jurisdiction in accordance with Section 37 of this Article, the Board may-'(a) direct that the Trial Examiner prepare an Intermediate Report, in which case the provisions of Sections 32 to 36, inclusive, of this Article shall in so far as applicable govern subsequent procedure, and the powers granted to Regional Directors in such provisions shall for the purpose of this Section be reserved to and exercised by the Board; or'(b) decide the matter forthwith upon the record, or after the filing of briefs or oral argument; or'(c) reopen the record and receive further evidence, or require the taking of further evidence before a member of the Board, or other agent or agency; or'(d) make other disposition of the case.'The Board shall notify the parties of the time and place of any such submission of briefs, oral argument, or taking of further evidence'.

Footnote 7 Section 10(b); 29 U.S.C. 160(b), 29 U.S.C.A. 160(b).

Footnote 8 These provisions of the order in substance required the companies to desist from discouraging membership in the United or encouraging membership in the Brotherhood, or any other labor organization of their employees, by discharges, or threats of discharge, or refusal of reinstatement, because of membership or activity in connection with any such labor organization; from permitting representatives of the Brotherhood to engage in activities in its behalf during working hours or on the employers' property unless similar privileges were granted to the United and all other labor organizations; from permitting employees who were officials of the Employees' Representation Plans to use the employers' time, property and money in behalf of the Brotherhood or any other labor organization; from employing detectives to investigate the activities of their employees in behalf of the United or other labor organizations, or employing for such purpose any other sort of espionage; and from 'in any other manner interfering with, restraining, or coercing its employees in the exercise of the right to self-organization, to form, join or assist labor organizations' or to bargain collectively or to engage in concerted activities for that purpose or other mutual aid or protection.

Footnote 9 29 U.S.C. 160(b), 29 U.S.C.A. 160(b).

Footnote 10 29 U.S.C. 160(c), 29 U.S.C.A. 160(c).

Footnote 11 29 U.S.C. 157, 29 U.S.C.A. 157.

Footnote 12 29 U.S.C. 159(c), 29 U.S.C.A. 159(c).

Footnote 13 29 U.S.C. 159, 29 U.S.C.A. 159.

[Footnote 1] National Labor Relations Board v. Fruehauf Trailer Co., 301 U.S. 49, 57 S.Ct. 642, 630, 108 A.L.R. 1352; National Labor Relations Board v. Friedman-Harry Marks Clothing Co., 301 U.S. 58, 57 S.Ct. 645, 630, 108 A.L.R. 1352; Associated Press v. National Labor Relations Board, 301 U.S. 103, 57 S.Ct. 650; Washington, Virginia & Maryland Coach Co. v. National Labor Relations Board, 301 U.S. 142, 57 S.Ct. 648.

[Footnote 2] National Labor Relations Board v. Fruehauf Trailer Co., 301 U.S. 49, 57 S.Ct. 642, 630, 108 A.L.R. 1352; National Labor Relations Board v. Friedman-Harry Marks Clothing Co., 301 U.S. 58, 57 S.Ct. 645, 630, 108 A.L.R. 1352; Associated Press v. National Labor Relations Board, 301 U.S. 103, 57 S.Ct. 650; Washington, Virginia & Maryland Coach Co. v. National Labor Relations Board, 301 U.S. 142, 57 S.Ct. 648; National Labor Relations Board v. Pennsylvania Greyhound Lines, 303 U.S. 261, 58 S.Ct. 571, 115 A.L.R. 307; National Labor Relations Board v. Pacific Greyhound Lines, 303 U.S. 272, 58 S.Ct. 577; Santa Cruz Fruit Packing Co. v. National Labor Relations Board, 303 U.S. 453, 58 S.Ct. 656; National Labor Relations Board v. Mackay Radio & T. Co., 304 U.S. 333, 58 S.Ct. 904.

[Footnote 1] Labor Board Cases, 301 U.S. 1 et seq., in securing their execution, advantageous A.L.R. 1352.

[Footnote 2] Secs. 7, 8, 10, Act of July 5, 1935, 49 Stat. 452-455, 29 U.S.C.A . 157, 158, 160.

[Footnote 3] 4 N.L.R.B. 71, 94.

[Footnote 4] Secs. 7 and 8, Act of July 5, 1935, 49 Stat. 452, 29 U.S.C.A. 157, 158.

[Footnote 5] National Labor Relations Board v. Pennsylvania Greyhound Lines, 303 U.S. 261, 267, 58 S.Ct. 571, 574, 115 A.L.R. 307.

[Footnote 6] Consolidated Edison Co. v. National Labor Relations Board, Nos. 19 and 25, this Term, rendered this day, , 59 S.Ct. 206, 221.

[Footnote 7] Washington, Virginia & Maryland Coach Co. v. National Labor Relations Board, 301 U.S. 142, 146, 57 S.Ct. 648, 649.

[Footnote 8] Consolidated Edison Co. v. National Labor Relations Board, Nos. 19 and 25, this Term, decided this day, , 59 S.Ct. 206.

[Footnote 9] National Labor Relations Board v. Pennsylvania Greyhound Lines, 303 U.S. 261, 263, 58 S.Ct. 571, 573, 115 A.L.R. 307.

[Footnote 10] Page 271, 58 S.Ct. page 576.