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Playskool Inc. v. National Labor Relations Board

decided: March 16, 1973.


Castle, Senior Circuit Judge, and Fairchild and Cummings, Circuit Judges. Fairchild, C.j. (dissenting).

Author: Castle


This case raises a much-litigated question as to the application and extension by the National Labor Relations Board of its Midwest Piping doctrine. The Board found that Playskool, Inc. violated § 8(a) (1) and (2) of the National Labor Relations Act, 29 U.S.C. §§ 158(a) (1) and 158(a) (2) (1970) by recognizing the Retail, Wholesale and Department Store Union (RWDSU) when another union, the United Furniture Workers, was also seeking recognition for the same units of employees. The Board also found that RWDSU violated § 8(b) (1) (A) of the Act by accepting such exclusive recognition. On this appeal Playskool and RWDSU seek review of the Board's order pursuant to § 10(f) of the NLRA; the Board filed a cross-application for enforcement of its order, which is reported at 195 NLRB No. 89 (1971).

Since 1952, the United Furniture Workers of America have attempted to organize employees at certain Playskool plants in the Chicago area. On several occasions during this time, United has demanded that Playskool recognize it as the exclusive representative of these employees and has offered to demonstrate its majority support through a showing of authorization cards. Each time Playskool has insisted upon a Board-conducted representation election instead of a card check, and each time United has lost the resulting election. The last such elections occurred in November and December, 1968, when United mustered 148 votes out of 494 eligible voters, approximately 29.9% of the total. Subsequent to this loss, United has engaged in continued organizational activity at Playskool's Chicago plants, although the extent of both this activity and the company's knowledge of it are disputed in this appeal. At the very least, United has confronted Playskool employees at their plant gates, solicited authorization cards, and held meetings.

The Retail, Wholesale and Department Store Union instituted its own campaign to organize Playskool employees in March, 1969. Utilizing home visits, inside-the-plant campaigning, and organizers who spoke the native Spanish language of certain employees, this union solicited signed cards authorizing RWDSU to bargain on behalf of individual employees. In April, 1969, company supervisors learned of RWDSU's campaign and decided that Playskool would not oppose that union because of its reputation as a "good union" that did not process many grievances or instigate many strikes. Later that month RWDSU requested Playskool to agree to a card check to verify its claim that it represented a majority of Playskool employees. After company approval, the Illinois Department of Labor's Conciliation Service was requested to check RWDSU's card against a company-prepared list of employees' names, clock numbers and addresses. On the basis of its examination the Conciliation Service announced that RWDSU had obtained valid authorization cards from at least 300 of the 500 employees listed. On May 2, the company and RWDSU executed a recognition agreement; they later agreed to the terms of a collective bargaining contract which contained union security provisions.*fn1

United filed a complaint against Playskool and RWDSU in June of 1969 which charged the two with violating the NLRA by executing a recognition agreement while United was also trying to obtain such recognition for the same employees. After hearing testimony and reviewing the evidence, the Trial Examiner issued his decision on June 22, 1971 which found no Midwest Piping violation. The Trial Examiner stated that § 8(a) (2) of the Act and the Midwest Piping doctrine could be violated only when an employer recognized one of two competing unions while the rival union raised a "question concerning representation," and that such a "question" was established when the rival union demonstrated (1) that it had obtained a "substantial representation among the employees, normally amounting to 30%," and (2) that it had demanded or requested recognition from the employer. Since United had met neither prerequisite, and since RWDSU had demonstrated that it represented an uncoerced majority of Playskool employees, the Trial Examiner concluded that United had not raised a "question concerning representation," and that consequently Playskool was free to recognize RWDSU.

A panel of the National Labor Relations Board overruled the Trial Examiner and found that Playskool and RWDSU had violated the Act by their execution of a recognition agreement when United also sought to obtain recognition from Playskool. The panel disagreed with the Trial Examiner's enumeration of the prerequisites that a rival union must meet to establish a "question concerning representation" and to preclude employer recognition of a competing union after a showing of authorization cards. The Board said:

The Board found that United had raised a question concerning representation by obtaining the required minimum of signatures to petition for an election in November and December of 1968, by polling 29.9% in the election, and by soliciting members after the election. The Board also concluded that the card check conducted by the Illinois Conciliation Service was not an "accurate barometer of the employees' sentiments" because United had not participated in the card check and because some employees had evidently signed authorization cards for both RWDSU and United.

On this appeal Playskool and RWDSU challenge the findings of the Board on two grounds: (1) substantial evidence does not support its conclusion that United conducted an organization campaign among Playskool employees and notified the company of its continued interest in representing them prior to the execution of the recognition agreement with RWDSU, and (2) as a matter of law, Playskool and RWDSU did not violate the Act because United did not present a substantial representation claim. Our disposition of the second issue renders any decision on the first largely superfluous, for we find that Playskool did not violate the Act by its recognition of RWDSU after an impartial third party had certified that the union represented a majority of Playskool employees.

I. The Applicable Law

Section 8(a) (2) of the National Labor Relations Act, 29 U.S.C. § 158(a) (2) makes it an unfair labor practice for an employer to "dominate or interfere with the formation or administration of any labor organization. . ." A significant application of this statutory language occurred in Midwest Piping and Supply, Inc., 63 NLRB 1060 (1945), where each of two competing unions presented the employer with a claim that it represented the majority of his employees and each filed a petition for an NLRB election to determine the issue of majority support. Before the election could be held, one of the unions presented authorization cards to the employer which purportedly proved that the union represented a majority of his employees. The Board found that recognition of this union by the employer amounted to a breach of his duty of neutrality and constituted a violation of § 8(a) (2).

As the petitioners correctly represented at oral argument, the Board and the Circuit Courts of Appeals which have reviewed Board decisions have disagreed upon the application and extension of the Midwest Piping doctrine. The Board has held that this doctrine precludes recognition of any union upon the basis of a card showing when another union has raised a "question concerning representation." The Board has not precisely defined the minimum amount of support a union must show to raise such a question,*fn2 but it has held that an election between two competing unions must be held if the claim of the rival is "not clearly unsupportable and lacking in substance." (See the Board decision in the instant case, reported at 195 NLRB No. 89.) Nor is it necessary for the rival union to present any claim to the employer that it currently has majority support, for the employer's knowledge of organizing activity is apparently sufficient to raise the question.

The courts, on the other hand, have generally refused to find a violation of § 8(a) (2) where an employer has recognized one of two unions competing for exclusive recognition on the basis of a clear demonstration of majority support. NLRB v. Peter Paul, Inc., 467 F.2d 700 (9th Cir. 1972), Modine Manufacturing Co. v. NLRB, 453 F.2d 292 (8th Cir. 1971), American Bread Co. v. NLRB, 411 F.2d 147 (6th Cir. 1969), Iowa Beef Packers v. NLRB, 331 F.2d 176 (8th Cir. 1964). The courts have reasoned that, in extending recognition to a union on such a showing, the employer has not "coerced or interfered with" the minority union, but has merely obeyed the duty imposed upon him to recognize the agent which his employees have designated. NLRB v. Indianapolis Newspapers, Inc., 210 F.2d 501, 503 (7th Cir. 1954). Thus, many decisions recognize that, however important the need to preserve the integrity of the Board's election machinery, courts must protect the right of employees to select and bargain through their own representative without undue delay.*fn3 Courts have also sought to implement the congressional purpose of promoting labor peace underlying the National Labor Relations Act, and have accepted a majority showing by the victorious union as a means of terminating the instability inherent in a representation contest and preventing a minority union from frustrating the majority will in order to gain campaigning time. NLRB v. Peter Paul, Inc., 467 F.2d at 702, NLRB v. Indianapolis Newspapers, Inc., 210 F.2d at 503, Getman, The Midwest Piping Doctrine: An Examination of the Need for a Reappraisal of Labor Board Dogma, 31 U. CHI. L. REV. 292, 305 (1964).

The courts have, however, recognized exceptions to the right and duty of an employer to recognize one of two competing unions which has demonstrated its support by a majority of employees. Where it can be shown that a union's majority support was due to unlawful coercion or deception, the courts have refused to accept the union's majority status and have held that the employer's recognition constituted a violation of § 8(a) (2). Oil Transport Co. v. NLRB, 440 F.2d 664, 665 (5th Cir. 1971), ...

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