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Pacemaker Yacht Co. v. National Labor Relations Board

decided: October 30, 1981.

PACEMAKER YACHT COMPANY, A DIVISION OF MISSION MARINE, INC., PETITIONER
v.
NATIONAL LABOR RELATIONS BOARD, RESPONDENT



ON PETITION FOR REVIEW AND CROSS-APPLICATION FOR ENFORCEMENT OF AN ORDER OF THE NATIONAL LABOR RELATIONS BOARD (Board Case No. 4-CA-9580)

Before Seitz, Chief Judge, and Adams and Garth, Circuit Judges.

Author: Seitz

Opinion OF THE COURT

Pacemaker Yacht Company (the Company) petitions for review of a final order of the National Labor Relations Board (the Board) directing the Company to cease and desist from restraining or coercing employees in the exercise of rights protected by section 7 of the National Labor Relations Act, 29 U.S.C. § 157 (1976), and to reinstate employees who had been fired for striking. The Board has cross-applied for enforcement of its order. This court has jurisdiction under 29 U.S.C. § 160(e) & (f) (1976).

I.

In 1978, the Company and Teamsters Union 158 (the Union) were parties to a collective bargaining agreement covering employees at two plants in New Jersey. The agreement required the Company to contribute forty cents per hour worked by each employee to the Teamsters Health and Welfare Fund of Philadelphia and Vicinity-Local 158. The Fund retained an independent insurance carrier to underwrite employee health and welfare benefits. The Company was not involved in the administration of the Fund, and at all times fulfilled its obligation under the collective bargaining agreement.

In early 1978, the Fund failed to pay premiums to the insurance carrier, and consequently the underwriter refused to pay the claims of the employee beneficiaries. On June 20, 1978, most employees at both plants went on strike in protest of the Fund's delinquency. Throughout the day, Union officials advised striking employees that the work stoppage violated the collective bargaining agreement and urged them to return to work. The Company mailed a notice to all employees advising them that the strike violated Article X of the collective bargaining agreement, which prohibited "all strikes, picketing ... or other interruption of the Company's operations," and stating that any employee who failed to report to the next shift would "be considered to have quit his job" and would be permanently replaced. One hundred and twenty-six employees who continued to strike after receiving this notice were discharged. The Union submitted a grievance on behalf of these employees, which proceeded to arbitration pursuant to the collective bargaining agreement. The arbitrator found that the strike violated Article X of the collective bargaining agreement but ruled that the discharge penalty was too severe, and ordered the Company to reinstate all strikers except those who instigated the strike. The Company complied with the award, and reinstated all but twenty employees who were identified as instigators in a subsequent grievance procedure.

The Union filed an unfair labor practice charge against the Company, alleging that the discharges restrained employees in their exercise of protected activity in violation of section 8(a)(1) of the Act. The administrative law judge dismissed the complaint, finding that the employees had waived their right to strike in Article X. The Board disagreed, and held that the no-strike clause in Article X did not waive employees' right to strike over the Fund's failure to pay insurance premiums. The Board examined the collective bargaining agreement and extrinsic evidence and concluded that "the union could not have made a clear and unmistakable waiver of the employees' right to strike to put pressure on the Fund since the parties never foresaw the possibility of such a situation." Pacemaker Yacht Co., 253 N.L.R.B. No. 95, 1980-81 Labor L.Rep. (CCH) P 17,733, at 28,579. Consequently, the Board found that the discharges violated section 8(a)(1) and ordered the Company to reinstate the employees with full seniority and backpay. The Company petitioned for review of that order and the Board cross-applied for enforcement.

II.

The Company urges that the Board's order should not be enforced for three reasons. First, the Company disputes the Board's finding that the no-strike clause in Article X of the collective bargaining agreement did not constitute a waiver of the right to strike over the Fund's failure to pay premiums to the insurance carrier. Second, it argues that the Board erred in failing to defer to the arbitrator's award in accordance with the standards established in Spielberg Manufacturing Co., 112 N.L.R.B. 1080 (1955). Finally, the Company contends that the strike was not protected activity under section 7 of the Act because the work stoppage involved a matter beyond its control. Because we find the waiver issue dispositive, it is unnecessary to address the Company's other arguments.

III.

Assuming, without deciding, that the strike at issue was protected activity under section 7 of the Act, we start with the proposition that generally employees may, through the collective bargaining process, waive the right to engage in this protected activity. Mastro Plastics Corp. v. NLRB, 350 U.S. 270, 280, 76 S. Ct. 349, 356, 100 L. Ed. 309 (1956). We have cautioned, however, that such a waiver must be "clear and unmistakable and that explicit language will not be read expansively." Delaware Coca-Cola Bottling Co. v. General Teamster Local 326, 624 F.2d 1182, 1187-88 (3d Cir. 1980).

In Delaware Coca-Cola, we held that a single, broad, generally-worded no-strike clause does not constitute a clear and unmistakable waiver of the right of employees to engage in a sympathy strike. 624 F.2d at 1187. Our holding was squarely grounded upon the application of the principle of coterminous interpretation to a single express no-strike clause. Under this rule of contract interpretation, a no-strike clause is presumed to be no broader than the arbitration clause in a collective bargaining agreement. See Gateway Coal Co. v. United Mine Workers, 414 U.S. 368, 382, 94 S. Ct. 629, 639, 38 L. Ed. 2d 583 (1974). Underlying this presumption is the theory that a no-strike clause is generally a quid pro quo for an arbitration clause. See Textile Workers Union v. Lincoln Mills, 353 U.S. 448, 455, 77 S. Ct. 912, 917, 1 L. Ed. 2d 972 (1957). In Delaware Coca-Cola, we were unable to find any extrinsic evidence indicating that the parties had intended the no-strike clause to be broader than the arbitration clause and thus held that since the sympathy strike was not arbitrable, it was not barred by the no-strike clause.

The principle of coterminous interpretation, however, is not a rule of law, but merely a tool of contract interpretation, see W-I Canteen Service Inc. v. NLRB, 606 F.2d 738, 744 (7th Cir. 1979), which "must be applied to the facts of each case," Delaware Coca-Cola, 624 F.2d at 1187.

The collective bargaining agreement at issue contained two separate ...


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