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Quaker State Oil Refining Corp. v. National Labor Relations Board

June 15, 1959

QUAKER STATE OIL REFINING CORPORATION, PETITIONER,
v.
NATIONAL LABOR RELATIONS BOARD, RESPONDENT.



Author: Mclaughlin

Before McLAUGHLIN and HASTIE, Circuit Judges, and MORRILL, District Judge.

McLAUGHLIN, C.J.: Petitioner seeks to review and have set aside a final order of the National Labor Relations Board.*fn1

The petitioner operates three refineries, one of which is at Emlenton, Pennsylvania. The Oil Chemical and Atomic Workers International Union and its predecessor has long been the certified collective bargaining representative of the Emlenton plant's production and maintenance workers who are members of Local 11-481. This case originated when unfair labor practice charges were made by the union against the company; they were a consequence of the partial shut-down of the Emlenton refinery on February 7, 1956, the day after a collective bargaining agreement had expired. Negotiations had been in progress for some time but agreement had not yet been reached on a new contract. It was the union's position, through the General Counsel of the Board, that the shut-down coerced the employees in the exercise of their collective bargaining rights, discriminated against the employees so as to discourage union membership, and amounted to a refusal to bargain collectively, all in violation of Sections 8(a)(1), (3) and (5) of the Act.*fn2 The company, however, has consistently maintained that the shut-down was dictated by considerations of plant and personnel safety because it required 72 hours in which to close down elements of the refinery which were dangerous or which could be expensively damaged by freezing if not attended by an adequate work force. After expiration of the contract containing a no-strike clause and without a new one the company felt itself vulnerable to a sudden strike. Additionally, the company asserts that even if the shut-down were not motivated for safety reasons, it was an economic weapon legitimately available to it as a counterfoil to the union's strike weapon. In short, it is the company's position that "No contract, no work" is as applicable to employees by an employer as it is by employees to their employer.

After much testimony, followed by a lengthy and exhaustive analysis of the facts and the inferences reasonably to be drawn therefrom, the trial examiner found as a fact that the company had effected the shut-down in order to induce the union to sign the contract the company wished and that the shut-down was not motivated by fear for the safety of the plant and personnel. The Labor Board narrowly made the same finding with three of the five members holding that the company "* * * did not have reasonable grounds for believing that the union would call a sudden strike to the detriment of the Respondent's vital operating units * * * ".

"The findings of the Board with respect to questions of fact if supported by substantial evidence on the record considered as a whole shall be conclusive."*fn3 We have concluded without the so often attendant difficulty that the Board's finding is supported by a marked preponderance of the evidence in the record. On January 30, 1956 the bargaining situation was that the company stood on its January 18th offer even though the local membership had voted on January 24th to reject it; a substantially similar contract, however, had been accepted by the local and signed by the union at the company's St. Mary's plant.*fn4 The union, on the other hand, insisted that it would not and could not accept an increase of less than 15 cents an hour.*fn5 This made a strike a possibility after February 6th and, as is not controverted, a sudden strike which took all employees promptly off the plant's premises could have been disastrous.

But a strike was not the only means by which the parties could be moved from their positions. The union's bargaining representatives had agreed to resubmit the company's proposal to the local membership; it could be anticipated that resistance of the party which lost this vote would soften.No one could justifiably have thought the possibilities of bargaining had been more than temporarily exhausted. There was nothing pointing to the union wanting to strike; indications were consistently to the contrary. The union had offered as early as January 9th to extend the expiring contract until April. When on January 30th the company representatives asserted that the critical elements of the plant must be closed down if the strike security afforded by a signed contract were not available, the union orally suggested a ninety day extension of the old contract with assurance that there would be no strike. The offer and assurances were put in writing by a letter the next day.

Though the company could legitimately choose to be intransigent, thereby creating a risk of momentary change in the union attitude, it was aware both from past experience and from the discussion on January 30th that by union rules there had to be a meeting of the local for the taking of a strike vote with three days notice of such a meeting. There had been neither vote nor notices. Furthermore, the company had little or no reason to doubt the effectiveness of the assurances given by the union negotiators. It had dealt with Russell in his capacity as president of the local for eight years and as a member of the bargaining committee for even longer. It had no reason to believe that he did not exert considerable influence with his fellow union members. Prorok, the representative of the international union, had also demonstrated by his actions in the 1954 Pennzoil wild-cat strike that both he and the union he represented were dependable.*fn6

Further evidence that the union was responsible and reasonable accrued from its history as bargaining representative for the company's employees. Never in those thirteen years had there been a sudden strike unauthorized by union procedures. And always when the union had desired to have available the right to strike suddenly, the company had been on prior notice by the strike vote and the preceding amenities. In other years the union, even when refusing to give 72 hours notice of the timing of the strike, on top of such notice had guaranteed a safe and orderly shut-down. During the bargaining proceedings from which this dispute developed the company never even bothered to ask for that sort of guarantee. When sudden strikes had been resorted to in the past either at Quaker plants or those of its competitors the union had always cooperated in the shut-down of the critical units. Such cooperation was in the self-interest of the employees who were, by the nature of their jobs, safety conscious.

In assessing the substantiality of the evidence we have been at pains to consider only those matters relevant to the company decision to shut-down as it was formulated up to February 3rd when the shut-down began; to apply hindsight in the light of what later occurred would not be a true assessment of the company's motives. Yet the actual events later transpiring also tend to bolster the Board's finding of fact.

The local membership on February 4th voted to accept the company offer of 9 cents an hour increase.This placed the union negotiators in the uncomfortable position of having to choose between the local's mandate and the international's expressed policy, since they were without authority to bind the international to anything less than a 15 cents an hour increase. The difficulty was presented to the international, which in mid-February refused, as was its prerogative under the union constitution, to approve the contract and recommended continuation of negotiations. In the meantime and thereafter sentiment developed among some of the members of the local for pressuring their bargaining representatives into signing the contract; this was aided and abetted to some extent by the company's president, who at first indicated he would re-activate the closed-down units if he were furnished a copy of the minutes of the vote accepting the company's offer. After the minutes were transmitted to him he claimed, at first, that he would require signatures of a majority of the employees, and later, of practically all the employees to a petition indicating acceptance of the contract in order to reactivate the plant without fear of a strike. The plant manager meanwhile took somewhat inconsistent positions in the renewed bargaining sessions to the effect that the company already had a contract but would need a signed contract as strike security before going back to full-time operation. All this time it was plainer than it had ever been before the February 4th vote that the rank and file were not minded to strike and that there could be no sound fear concerning plant safety if the plant were kept in full operation.

The state of the record makes it obligatory upon us to affirm the Labor Board's finding of facts.

So we arrive at the area of petitioner's partial economic lockout. But, as we see it, even if the vital element of continuing bargaining negotiations was not here present, this is not off somewhere by itself - an isolated area. It must be dealt with as an integral part of the particular existing labor management situation. It is for this reason that there can be no flat, all inclusive pronouncement that an economic lockout is either forbidden or allowed under the Labor Management Act of 1947.

The Board based its decision on the following principles:

"* * * that, absent special circumstances, an employer may not during bargaining negotiations either threaten to lock out or lock out his employees in aid of his bargaining position. Such conduct the Board has held presumptively infringes upon the collective bargaining rights of employees in violation of Section 8(a)(1) and the lockout, with its consequent layoff, amounts to discrimination within the meaning of Section 8(a)(3). In addition, the Board has held that such conduct subjects the Union and the employees they represent to unwarranted ...


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