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International Association of Machinists and Aerospace Workers v. J.L. Clark Co.

decided: November 20, 1972.

INTERNATIONAL ASSOCIATION OF MACHINISTS AND AEROSPACE WORKERS, DISTRICT NO. 8, AFL-CIO, PLAINTIFF-APPELLEE,
v.
J.L. CLARK COMPANY, DEFENDANT-APPELLANT



Kiley and Pell, Circuit Judges, and Gordon, District Judge.*fn1 Pell, C. J., dissenting.

Author: Kiley

KILEY, C. J..

This is an appeal by J.L. Clark Company (Company) from a summary judgment for International Association of Machinists and Aerospace Workers, District No. 8, AFL-CIO (Union) in the Union's suit under Section 301 of the Labor Management Relations Act, 29 U.S.C. § 185, to enforce an arbitration award. We reverse and remand.

The vital issue presented is whether an employee who abandoned a general strike against the Company and returned to work should be entitled to retain the position he now occupies despite the fact that his level of seniority is inferior to a worker who, having participated in the strike until a settlement was reached, now seeks reinstatement to the same position.

The principles of law governing this question are well settled. Section 2(3) of the National Labor Relations Act (61 Stat. 137, 29 U.S.C. § 152(3)) provides that a striking employee remains an employee unless he has obtained regular and substantially equivalent employment. It is incumbent upon an employer at the conclusion of a strike to reinstate striking employees. Refusal to reinstate has the effect of discouraging employees in the exercise of their Section 7 right to organize and strike, 61 Stat. 140 and 151, 29 U.S.C. §§ 157 and 163, and is therefore an unfair labor practice. NLRB v. Fleetwood Trailer Co., 389 U.S. 375, 378, 19 L. Ed. 2d 614, 88 S. Ct. 543 (1967). However, where an employer can show that "legitimate and substantial business justification" exist which prevents reinstatement, he will be excused from the requirement. NLRB v. Great Dane Trailers, 388 U.S. 26, 34, 18 L. Ed. 2d 1027, 87 S. Ct. 1792 (1967). One business justification now recognized to be "legitimate and substantial" results when an employer hires "permanent replacements" to perform the work of striking employees. In this situation, the employer's interest in continuing his business during an economic strike, coupled with the necessity of offering the inducement of permanent employment to secure employees willing to violate a picket line, justifies the exception of the reinstatement requirement. See NLRB v. Mackay Radio & Telegraph Co., 304 U.S. 333, 82 L. Ed. 1381, 58 S. Ct. 904 (1938); NLRB v. Fleetwood Trailer Co., supra, at 379; NLRB v. Plastilite Corp., 375 F.2d 343 (8th Cir. 1967); NLRB v. Colonial Manor Convalescent & Nursing Home, (7th Cir. decided August 3, 1972).

Simply stated, the question before us is whether the employee who abandoned the strike and returned to work resumed work as a "permanent replacement." If so, he is clearly entitled to retain his present position despite his inferior seniority level. To resolve this controversy, the trial court had before it the following facts: On January 20, 1970, having failed to reach agreement on a new collective bargaining agreement, the Union called a general strike against the Company. During the course of the ensuing five month strike, employee Hinsch abandoned the strike and returned to his position as a machinist in the Company's Tool Room Department. On April 7, 1970, employee Cinelli, a tool and die maker, engaged in several acts of picket line misconduct which resulted in his discharge by the Company.

Further: Agreement was reached on a new collective bargaining agreement in June, 1970, and the strike was settled. Under the settlement the Company agreed to submit the question of Cinelli's discharge to arbitration and to reinstate striking employees on a seniority basis. The arbitrator found that while Cinelli had in fact been guilty of misconduct, his long and distinguished service with the Company as employee and Union steward mitigated his behavior to the extent that discharge was too harsh a punishment for his misconduct. The effect of the award was to convert the discharge to a disciplinary suspension without pay which was to end no later than November 27, 1970. Cinelli's seniority rights were left unimpaired.

Immediately after the disciplinary suspension period had expired, Cinelli notified the Company that he intended to report for work. However, when he reported he was told by the plant manager that there was no position available for him.*fn2 The Union made inquiries concerning the basis for the Company's refusal to reinstate Cinelli and upon learning that Hinsch, whose seniority level was lower than Cinelli's, was employed, demanded that the Company replace Hinsch. The Company refused, taking the position that Cinelli's greater seniority did not entitle him to the position occupied by Hinsch since Hinsch was being treated as a " permament replacement." Based upon the Company's refusal to reinstate Cinelli, the Union brought this Section 301 action to enforce the arbitrator's award.

Both parties moved for summary judgment and supported the motions with affidavits. The district court denied the Company's motion and granted the Union's motion pursuant to a finding that Hinsch "is not a permanent replacement" and that his post-strike employment did not come within the "legitimate and substantial business justifications" exception to the rule in NLRB v. Fleetwood Trailer Co., supra.

We find that the district court improperly granted the Union's motion for summary judgment. Rule 56(c) of the Federal Rules of Civil Procedure provides that summary judgment shall be rendered only where no genuine issue as to any material fact exists. Having reviewed all the information brought before the trial court in the various affidavits supporting the summary judgment motions, the opinion of the arbitrator and the pleadings, we believe the substantial factual question of whether Hinsch was a "permanent replacement" remains unresolved.

In considering motions for summary judgment, courts must bear in mind that summary judgment is a form of relief which should be applied with caution to the end that litigants be allowed a trial on bona fide factual issues. Smoot v. Chicago R.I. & P. Co., 378 F.2d 879 (10th Cir. 1967). Where, as here, inferences are drawn from admitted underlying facts, those inferences must be drawn in the light most favorable to the party against whom the motion is directed and it is the duty of the court to resolve all doubts as to the existence of genuine issues of material facts against the party moving for summary judgment. Technograph Printed Circuits Ltd. v. Methode Electronics, Inc., 356 F.2d 442 (7th Cir.), cert. denied Croname, Inc. v. Technograph Printed Circuits Ltd. 384 U.S. 950, 16 L. Ed. 2d 547, 86 S. Ct. 1570 (1966). These basic principles governing the use of summary judgment were not complied with by the district court.

Basic to the decision below is the court's conclusion that Hinsch was not in fact a "permanent replacement." The arbitrator did not reach the question of Hinsch's status as an employee vis-a-vis other employees. The only question submitted to arbitration, as stated in the Arbitration Award and Opinion, was:

Was . . . Cinelli . . . discharged for good cause and/or should ...


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