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Air Line Pilots Association v. United Air Lines Inc.

decided: September 29, 1986.


Appeals from the United States District Court for the Northern District of Illinois, Eastern Division. No. 85 C 4765 - Nicholas J. Bua, Judge.

Wood, Jr., and Coffey, Circuit Judges, and Noland, District Judge.*fn*

Author: Wood

WOOD, JR., Circuit Judge.

This case arises out of a twenty-nine day strike by the Air Line Pilots Association, International ("ALPA") against United Air Lines, Inc. ("United"). Although the parties ultimately reached a new collective bargaining agreement, three issues which evolved as a result of the strike remain for judicial resolution. The first issue concerns United's plan that allowed pilots who worked during the strike to "bid" for vacancies left by the striking pilots. The second issue involves permanent replacement pilots that United hired during the course of the strike. United agreed to pay these pilots a guaranteed salary as a means of inducing them to work for the airline. The final issue involves the treatment of prospective new second officers who were in training prior to the commencement of the strike (hereinafter the "Group of 500"). United had anticipated using these trainees as replacement pilots and had offered them employment beginning on May 17, 1985, the day ALPA went on strike.

With respect to these issues, ALPA filed suit alleging various violations of the Railway Labor Act, as amended, 45 U.S.C. § 151 et seq. (1982) (the "RLA" or the "Act"). Following a ten-day trial, Judge Nicholas J. Bua concluded: (1) that United had violated the RLA by opening vacancies to rebidding by pilots who had crossed the picket line; (2) that the terms and conditions under which United hired its permanent replacements, including the guaranteed salaries, were lawful; and (3) that the Group of 500, although not employees during their training period prior to the strike, became employees of United on May 17, and that United's failure to extend them employee status on that date was in contravention of the RLA. In the alternative, even assuming that the Group of 500 never became employees, the trial judge found that United: (1) violated the RLA's status quo provisions by treating the trainees as non-employees during the training period; and (2) violated the RLA's provision against coercing persons not to join a union by making employment for the Group of 500 contingent on crossing the picket line.*fn1 The district court initially enjoined United from implementing the bid awards made during the strike as well as barred the airline from giving nostrikers preference in any vacancy arising subsequent to the strike. The court also ordered United to reinstate those members of the Group of 500 who had respected the picket line and "to assign them immediately to line pilot service if they completed their training, and otherwise permit them to complete their training without discrimination, and then enter line service, with seniority in all cases accrued from May 17, 1985." 614 F. Supp. at 1051. Thereafter, the district court amended its order regarding the Group of 500 to provide that United only be required to place these pilots on a preferential hiring list so that they would be hired as positions became available. In addition, the court denied ALPA's motion seeking back pay for the Group of 500.

On appeal, United argues that the court erred in holding: (1) that its bidding procedures were unlawful; (2) that the Group of 500 became employees on May 17; and (3) that the status quo provisions of the RLA were violated by United's considering the Group of 500 as non-employees during training. United also argues that the district court erred in granting injunctive relief to ALPA since the union had used economic coercion during the statutory status quo period before the strike and had initially refused to ratify its agreement with United until United reached a satisfactory back-to-work agreement with its flight attendants. ALPA cross-appeals alleging that the district court erroneously; (1) upheld United's guaranteed salaries to replacement pilots; (2) ruled that the Group of 500 were not entitled to immediate reinstatement; and (3) refused to award the Group of 500 back pay for the time between the end of the strike and their reinstatement.

We affirm the district court's decisions with respect to the replacement pilots and the implementation of the rebid procedures. However, we reverse the court's decision regarding the Group of 500.


The district court made extensive findings of fact which we summarize below. We are, of course, required to adopt these factual findings unless they are shown to be clearly erroneous. See Fed. R. Civ. P. 52(a).*fn2

The present action was commenced by ALPA on May 16, 1985, i.e., one day prior to the commencement of the strike. ALPA is the duly certified representative for United's airline piolets under the RLA. The representation of United's pilots is controlled by the United Air Lines Master Executive Council ("UAL-MEC"). UAL-MEC is composed of three elected member pilots from each of United's nine pilot domiciles.*fn3

For a number of years prior to the strike United and ALPA had been parties to successive collective bargaining agreements. The agreement controlling prior to the strike had been in effect since October 1981. This agreement was to be effective until October 1983 and would automatically renew itself for a one-year period each October thereafter unless either party sought a change. In January 1984, both parties served notice of their desire to discuss new contractual terms. United sought to renegotiate, among other things, compensation to be paid both incumbent employees and new hires as well as the method used to assign cockpit seats to pilots. United was seeking changes, in part, as a result of economic pressures to cut costs which accompanied the deregulation of the airline industry. As negotiations progressed, it became obvious that the key issue was United's desire to have a reduced pay scale for those pilots hired during the duration of a new agreement. United expressed concern that without cost-cutting measures it would not be competitive in the newly deregulated market. Indeed, although United had an operating profit of in excess of $500 million in 1984, it had sustained operating losses in the preceding five years.

Although continuing with the negotiations, United, in the fall of 1984, began to prepare for a pilots' strike by establishing a task force to develop contingency plans. The task force devised the "operations adjustment plan" which had an objective of breaking any strike and forcing settlement on United's terms. At the same time, United also began to experience a shortage of pilots. United had last hired pilots during the period from 1977-1979. At that time, it had been United's policy to consider its student pilots as employees beginning with their first day of training. These trainees were paid and earned seniority from the first day of their hire. Once these student pilots completed the training process, they were brought into United to serve in the entry-level position of second officer.*fn4

With the need for new pilots evident, United, beginning in November 1984, selected numerous candidates (i.e., the Group of 500) for its training program. During this time, however, while United negotiated with ALPA with respect to the new-hire pay scale, the airline did not want the trainees on its property fearing that their presence would make an agreement with ALPA on new-hire pay more difficult. United also was opposed to paying the trainees the rates for incumbents as provided in the 1981 agreement. United therefore stated that these trainees would not be offered employment until after an agreement had been reached with ALPA. Indeed, the student pilots who were selected for training were required to execute a "Flight Officer Training Agreement." Under this agreement, the student pilots would receive training without charge from United as well as $30 per day to cover their expenses. The students agreed that during training they were not employees of United and received no compensation for their services apart from the expense money. The agreement, which each trainee signed, also provided:

I understand that graduates of Flight Officer Training will constitute a pool of trained candidates for Flight Officer employment, which United Airlines may employ, if needed, within twelve months of graduation. I understand that in order to be offered such employment, that I must continue to meet the requirements and qualifications for the flight officer position.

Pursuant to the agreement United was free, without incurring liability, to terminate the training or never make an offer of permanent employment.

In April 1985, United offered approximately 375 members of the Group of 500, who had successfully completed their training, positions as second officers. The offers of employment were effective May 17, 1985, regardless of whether a strike had commenced. The district court concluded that when initially offered employment the Group of 500 were not hired to serve as "crossovers" in the event of a strike. Indeed, several of the student pilots indicated that United had told them that they would not be asked to cross a picket line. As the May 17 strike deadline approached, however, United began to see the Group of 500 as strike replacements and informed the members that if they failed to report to work they would not work for the airline in the future. In fact, United's Chairman and Chief Executive Officer Richard Ferris commented:

We have got 500 pre-hires, right? Those pre-hires, are all going, they've been given notice, and come 0001 May 17, they're employed, boom. If they don't show up to work, they will never, ever, work for this air line, ever, because they're not on the property, they won't have a number, they don't have anything.

Nonetheless, the student pilots had a disincentive to report to work during a strike. Under ALPA's constitution and bylaws a member-pilot is subject to expulsion for "performing work for or assisting an airline during a period when the members of [ALPA] are on strike against such airline." ALPA constitution art. VIII, § 2(A)(5). Moreover, applicants for ALPA membership who were "involved in alleged strikebreaking shall not be accepted for membership" except, as the district court found, pursuant to rigorous procedures. Id., art. II, § 10(B).

Apart from plans regarding the Group of 500, United also promised other policy changes in an attempt to lure pilots across the picket line in the event of a strike. These plans were communicated to United's pilots via letters and various "road shows" undertaken by United management personnel. One plan called for United to allow "bidding" for positions opened up by a strike. Under United's bid procedure, pilots could express their interest for, among other things, vacant higher-level positions for which they were qualified as well as for other pilot domiciles. If a pilot's bid was accepted, he was then able to advance to his desired position. By allowing a rebid of the entire airline subsequent to the commencement of a strike, United sought to induce its pilots to ignore the strike for fear that they would lose their present positions and be impeded from advancing in the future by less-senior pilots.

In addition to rebidding the airline, United also informed its pilots that it was intending, in the event of a strike, to hire as permanent replacements for striking pilots outside individuals who were already qualified to serve as captains or first officers. To induce these "fleet-qualified" pilots to work for the airline during a strike, United was prepared to pay captains an annual salary of $75,000 and first officers a salary of $50,000. United also promised to guarantee these salary levels even if the replacement pilots were later reassigned to lower positions. Use of these guaranteed salaries was another means United hoped would help keep the airline flying in the event of a strike.

By April 15, 1985, United and ALPA had failed to reach a new collective bargaining agreement and the National Mediation Board ("NMB"), which had become involved in the negotiations during the previous August, declared an impasse in negotiations. On April 16, the final thirty-day "cooling-off" period mandated by the RLA began. During this period United and ALPA continued their collective bargaining, but their efforts were to no avail. On May 17, ALPA struck United. Approximately 500 pilots reported to work during the first three days of the strike, 250 of these being management pilots. Only a few members of the Group of 500 crossed the picket line and those already at United facilities left.

Shortly after the strike began, United cancelled all of its pilot assignments both for striking and nonstriking pilots. The result of this action was to create vacancies in every position in the airline. Nonstriking pilots who had reported to work before 6:00 p.m. Chicago time on May 19 were allowed to bid on these vacancies with the exception of the Miami and Washington domiciles. The vacancies were not actually awarded until after June 1, 1985, and, during the strike, no pilot was activiated in any assignment awarded to him in the rebid. As a result of the rebid, nonstriking pilots were able to leapfrog over more senior striking pilots. In addition to the rebid, United also employed the guaranteed salaries to attract fleet qualified pilots to serve as permanent replacements for striking pilots.

For its part, ALPA also took actions both before and during the strike in order to protect its interests. United alleges that, prior to the strike, ALPA undertook a campaign to inform travel agents around the country of the impending strike and suggested that these agents book their clients on airlines other than United. Moreover, United also contends that ALPA members engaged in a concerted abuse of sick leave to put economic pressure on the airline as well as picketed the World Trade Conference hosted by United's Chairman and Chief Executive Officer Richard Ferris in an attempt to dissuade conference attendees from using United. Once the strike began, ALPA also instructed its strike supervisors to take pictures of the pilots and management personnel who crossed the picket line. ALPA also photographed working pilots at this time.

During the course of the strike, ALPA and United resumed their contract negotiations. In June 1985, the parties reached a tentative back-to-work agreement. Under this agreement the pilots would return to work and assume the same positions they had held prior to the strike. Both United and ALPA agreed not to punish either the striking or nonstriking pilots. With respect to the status of the members of the Group of 500, the rebid, and the replacement pilots, however, United agreed that ALPA would pursue its claims in the district court. Although United agreed to restore all pilots to their pre-strike positions, when new vacancies arose, either due to attrition or expansion, United stated it would award the vacancies, in order of seniority, to nonstriking pilots who had been awarded similar positions during the strike rebid. In other words, nonstrikers were to be given preference over strikers. United also maintained that it would not hire any member of the Group of 500 who had failed to report to work except for cases involving personal hardship or other extenuating circumstances. Finally, United stated that it planned to continue to pay the guaranteed salaries to the fleet-qualified replacements.

Apart from its own agreement, ALPA had also discussed with United how the airline would handle its dispute with the Association of Flight Attendants ("AFA") whose members had honored ALPA's picket line. In keeping with a pre-strike commitment, ALPA maintained that its back-to-work agreement would be contingent upon AFA also reaching a back-to-work agreement. Ultimately AFA released ALPA from its commitment. ALPA subsequently ratified the tentative agreement with United and the strike came to an end.

ALPA filed suit alleging that United's actions with respect to the Group of 500, the rebid procedure, and the guaranteed salaries for the replacement pilots violated the RLA. The district court agreed with ALPA regarding the rebid and the Group of 500, but held that the hiring of the replacement pilots was lawful. The court ordered that United be enjoined from implementing the strike bid awards and also from preferring nonstrikers over strikers in vacancies that may arise. The court directed United to restore the Group of 500 to employee status and to assign them immediately to line service if they have completed training or allow them to first complete training. In so ruling, the district court rejected United's contention that ALPA was not entitled to injunctive relief on grounds that it had violated the RLA by conditioning the end of the strike upon United reaching a back-to-work agreement with AFA and by otherwise acting with "unclean hands."

The court subsequently amended its order noting that the Group of 500 had been permanently replaced during the strike and hence that they had no right to immediate employment, but rather were to be given preference when vacancies arose. The court also denied ALPA's motion seeking back pay for the Group of 500. The court noted that since these pilots had been properly replaced during the strike they were entitled to only back-dated seniority and preferential hiring.

United appeals the court's decision arguing that it was error to hold the airline in violation of the RLA with respect to the Group of 500 and the rebid procedure. Even if its actions are unlawful, United contends that ALPA is not entitled to injunctive relief. ALPA cross-appeals alleging that, among other things, the court erred in holding that United's hiring of replacements was lawful and in ruling that members of the Group of 500 were not entitled to either immediate reinstatement or back pay.


Before reaching the merits of this case, it is necessary that we first briefly examine the relevant provisions of the RLA.*fn5 As the Supreme Court noted in Brotherhood of Railroad Trainmen v. Jacksonville Terminal Co., 394 U.S. 369, 22 L. Ed. 2d 344, 89 S. Ct. 1109 (1969), the "heart" of the RLA is the duty placed on management and labor "'to exert every reasonable effort to make and maintain agreements concerning rates of pay, rules, and working conditions, and to settle all disputes . . . in order to avoid any interruption to commerce or to the operation of any carrier growing out of any dispute between the carrier and the employees thereof.'" Id. at 377-78 (quoting 45 U.S.C. § 152, First (1982)). See 45 U.S.C. § 151a(1) (one purpose of the RLA is "to avoid any interruption to commerce or to the operation of any carrier engaged therein"). Accord Chicago & North Western Railway v. United Transportation Union, 402 U.S. 570, 574, 29 L. Ed. 2d 187, 91 S. Ct. 1731 (1971). The RLA was enacted to encourage collective bargaining by the parties "in order to prevent, if possible, wasteful strikes and interruptions of interstate commerce," especially in cases where major disputes*fn6 are involved. Detroit & Toledo Shore Line Railroad v. United Transportation Union, 396 U.S. 142, 148, 24 L. Ed. 2d 325, 90 S. Ct. 294 (1969) (footnote omitted).

In settling major disputes such as the one involved here under the RLA a two-stage process is followed. The party seeking a change in rates of pay, rules, or working conditions must first give notice and confer with the other party. 45 U.S.C. § 156 (1982). See 45 U.S.C. § 152, Second (1982). If this conference fails to resolve the dispute, either or both parties may seek the mediation services of the National Mediation Board. The NMB may also act, sua sponte, in an emergency situation. 45 U.S.C. § 155, First (1982). If mediation by the NMB proves to be unsuccessful, the NMB is required to endeavor to induce the parties to submit the matter to binding arbitration. However, arbitration cannot be forced upon the parties; rather, arbitration is permitted only where the parties mutually consent. 45 U.S.C. §§ 155, First, 157 (1982). If arbitration is rejected and if the dispute threatens "substantially to interrupt interstate commerce to a degree such as to deprive any section of the country of essential transportation service," the NMB must contact the President who is then free to create an emergency board to "investigate and report respecting such dispute." 45 U.S.C. § 160 (1982). Throughout this first step of the mandated dispute resolution, the parties are barred from unilaterally altering the established status quo. 45 U.S.C. §§ 152, Seventh, 155, First, 156, 160 (1982).

Once these procedures have been followed without the dispute being resolved, the parties are free in the second stage, except as they may be otherwise limited by statute, to engage in economic self-help. Although the RLA is silent as to what may lawfully occur in this period, Burlington Northern Railroad v. Brotherhood of Maintenance of Way Employees, 793 F.2d 795 (7th Cir. 1986), it is undisputed that "implicit in the statutory scheme . . . is the ultimate right of the disputants to resort to self-help -- 'the inevitable alternative in a statutory scheme which deliberately denies the final power to compel arbitration.'" Jacksonville Terminal Co., 394 U.S. at 378 (quoting Florida East Coast Railway v. Brotherhood of Railroad Trainmen, 336 F.2d 172, 181 (5th Cir. 1964), cert. denied, 379 U.S. 990, 13 L. Ed. 2d 611, 85 S. Ct. 703 (1965)). This is not to say, however, that a disgruntled employer is free to use self-help measures to rid itself of a union or unnecessarily alter the employer-employee relationship. Unions and the employees they represent are similarly limited in the types of self-help measures they can employ. See Jacksonville Terminal Co., 394 U.S. at 392 (recognizing that "parties who have unsuccessfully exhausted the Railway Labor Act's procedures for resolution of a major dispute [are allowed] to employ the full range of whatever peaceful economic power they can muster, so long as its use conflicts with no other obligation imposed by federal law"). Cf. Brotherhood of Railway & Steamship Clerks v. Florida East Coast Railway, 384 U.S. 238, 247, 16 L. Ed. 2d 501, 86 S. Ct. 1420 (1966) (noting that in a case where the collective bargaining agreement is still in effect that "while the carrier has the duty to make all reasonable efforts to continue its operations during a strike, its power to make new terms and conditions governing the new labor force is strictly confined, if the spirit of the Railway Labor Act is to be honored") (footnote omitted).

With respect to unions, the RLA provides specific statutory protections which ensure that an employer cannot implement measures under the guise of self-help which are intended solely to destroy a union's ability to represent its membership. See 45 U.S.C. § 151a(2) (one purpose of the RLA is "to forbid any limitation on freedom of association among employees or any denial, as a condition of employment or otherwise, of the right of employees to join a labor organization") (1982).*fn7 For example, the Act provides that employee and employer representatives for collective bargaining purposes be chosen "by the respective parties without interference, influence, or coercion by either party." 45 U.S.C. § 152, Third. Similarly, "employees shall have the right to organize and bargain collectively through representatives of their own choosing." 45 U.S.C. § 152, Fourth. In order to protect this right, the RLA provides that management may not

deny or in any way question the right of its employees to join, organize, or assist in organizing the labor organization of their choice, and it shall be unlawful for any carrier to interfere in any way with the organization of its employees, or to use the funds of the carrier in maintaining or assisting or contributing to any labor organization, labor representative, or other agency of collective bargaining, or in performing any work therefor, or to influence or coerce employees in an effort to induce them to join or remain or not to join or remain members of any labor organization, or to deduct from the wages of employees any dues, fees, assessments, or other contributions payable to labor organizations, or to collect or to assist in the collection of any such dues, fees, assessments, or other contributions. . . .

Id. In the same way, the RLA also prohibits management from requiring "any person seeking employment to sign any contract or agreement promising to join or not to join a labor organization." 45 U.S.C. § 152, Fifth.

In the present case, the problem we face is to ascertain whether the various self-help measures employed by both United and ALPA unlawfully impinged upon statutory protections provided under the RLA. At first glance, it may seem that this problem could be easily resolved; either an action is or is not in contravention of federal law. However, in reality, it is a difficult question to determine when, if ever, an otherwise legitimate self-help measure begins to impede upon a statutory protection. In implementing self-help measures to ensure the continuation of its operation during the strike, United necessarily acted, either intentionally or unintentionally, in ways that adversely affected ALPA members. Similarly, ALPA acted in ways which adversely affected United. In such a situation, it was inevitable that a clash occurred between United's right to self-help and ALPA members' right to organize without being coerced or influenced. Our function now is to determine whether the appropriate balance between competing rights was achieved. Cf. Empresa Ecuatoriana De Aviacion S.A. v. District Lodge No. 100, 690 F.2d 838, 844-45 (11th Cir. 1982) (upholding in a minor dispute case, the district court's conclusion that "the carrier struck a proper balance between its twin obligations to serve the public and to attempt its twin obligations to serve the public and to attempt reasonably to maintain the employer-employee relationship"), cert. dismissed, 463 U.S. 1250, 104 S. Ct. 40, 77 L. Ed. 2d 1457 (1983).

The first issue we reach in this regard is whether the district court erred in concluding that United's rebidding of the airline violated the RLA. The district court found that United's rebid was unlawful since the airline "failed to justify the rebid as reasonably necessary for its operations during the strike" and because United's actions were motivated by anti-union considerations.

As the district court noted, it is well-established under the RLA that once the mediation and arbitration step has been completed, albeit unsuccessfully, both sides are free to engage in self-help as a means of continuing operations as well as a means of inducing a settlement. As a result, United was free within certain bounds to take the steps necessary to continue flying; the airline's right to employ self-help measures during the strike stopped, however, where its duties under the RLA and other laws began. See Jacksonville Terminal Co., 394 U.S. at 392.

ALPA contends, citing 45 U.S.C. § 152, Third and Fourth, that the RLA prohibits employers from retaliating against employees for engaging in a lawful strike. Although we agree with this proposition as a general matter, our analysis cannot end here. The real issue is what constitutes unlawful retaliation. It goes without saying that since the Act provides for the use of self-help by an employer, all measures of self-help cannot constitute unlawful retaliation. To assist us in resolving this issue ALPA suggests that we refer, as the district court did, to the National Labor Relations Act (the "NLRA" or the "Wagner Act"), 29 U.S.C. § 151 et seq. (1982) "as a definitive guide to contemporary meaning" of identical terms used both in the NLRA and the RLA. ALPA contends that the similarity between the relevant provisions of the NLRA and the RLA mandates that the two statutes be generally interpreted in the same way.

United, on the other hand, argues that the NLRA and the RLA were never intended by Congress to be applied in similar fashions, an intent the courts, United contends, have respected. The Second Circuit has noted that the NLRA and the RLA were directed at remedying problems in different arenas where the relative economic power of the participant labor organizations vis-a-vis the employer varied:

The special situation in the railroad industry, where strong unions and management had become used to dealing with each other, differed vitally from the host of problems at which the Wagner Act was aimed -- businesses of every size and description, many with a history of strong anti-union bias and with ample opportunity for strong-arm tactics. It was thus natural that the Wagner Act should stress administrative adjudication whereas the earlier Railway Labor Act relied primarily on mediation.

Ruby v. American Airlines, Inc., 323 F.2d 248, 256 (2d Cir. 1963), cert. denied, 376 U.S. 913, 11 L. Ed. 2d 611, 84 S. Ct. 658 (1964). See Klemens v. Air Line Pilots Association, International, 736 F.2d 491, 496 (9th Cir.) (noting that "the NLRA and the RLA are fundamentally different"), cert. denied, 469 U.S. 1019, 105 S. Ct. 435, 83 L.Ed 2d 362 (1984). Indeed, even the Supreme Court has concluded that "the National Labor Relations Act cannot be imported wholesale into the railway labor arena. Even rough analogies must be drawn circumspectly, with due regard for the many differences between the statutory schemes." Jacksonville Terminal Co., 394 U.S. at 383 (footnote omitted). Accord Chicago & North Western Railway v. United Transportation Union, 402 U.S. at 579 n.11 (noting that "all parallels between the NLRA and the [RLA] . . . should be drawn with the utmost care"); Ruby, 323 F.2d at 256 ("the claim that the courts should do under the Railway ...

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