Local Lodge No. 1424 v. National Labor Relations Board/Opinion of the Court

The question we decide in this case is whether unfair labor practice complaints, whose charges against the petitioners were sustained by the National Labor Relations Board, were barred by the six-month statute of limitations contained in § 10(b) of the National Labor Relations Act, as amended, 61 Stat. 146, 29 U.S.C. § 160(b), 29 U.S.C.A. § 160(b). That section reads in pertinent part:

'Provided * *  * no complaint shall issue based upon any      unfair labor practice occurring more than six months prior to      the filing of the charge with the Board and the service of a      copy thereof upon the person against whom such charge is made      *  *  * .'

On August 10, 1954, petitioners Bryan Manufacturing Company and the International Association of Machinists, AFL, entered into a collective bargaining agreement for a unit of Bryan's employees. The agreement, as later supplemented in certain respects not material to this litigation, contained the conventional provisions, of which two are relevant here: the 'recognition' clause, by which the Union was recognized as 'the sole and excusive bargaining agency for all employees' in the unit; and the 'union security' clause, by which all employees were required, subject to a 45-day grace period, to become and remain members of the Union. On August 30, 1955, a new agreement was entered into, with Bryan, the Union, and petitioner Local Lodge No. 1424, IAM, as signatories, replacing the old agreement and applying additionally to employees at a newly opened plant as well as to those covered by the original agreement.

When the original agreement was executed on August 10, 1954, the Union did not represent a majority of the employees covered by it. Under §§ 7 and 8 of the Act the Board has evolved the principle, not drawn in question here, that it is an unfair labor practice for an employer and a labor organization to enter into a collective bargaining agreement which contains a union security clause, if at the time of original execution the union does not represent a majority of the employees in the unit. The maintaining of such an agreement in force is a continuing violation of the Act, and the 'majority status' of the union at any subsequent date-including the date of execution of any renewals of the original agreement-is immaterial, for it is presumed that subsequent acquisition of a majority status is attributable to the earlier unlawful assistance received from the original agreement.

In June and August 1955, 10 months and 12 months after the execution of the original agreement, charges were filed with the Board and served upon the petitioners, alleging the Union's lack of majority status at the time of execution and the consequent illegality of the continued enforcement of the agreement. Complaints were thereafter issued by the Board's General Counsel against the Union and the Company. Petitioners contended before the Board that the complaints were barred by the limitations proviso of § 10(b), set forth above. The Board, two members dissenting, held that the complaints were not barred by limitations, 119 N.L.R.B. 502, and the Court of Appeals affirmed, one judge dissenting. 105 U.S.App.D.C. 102, 264 F.2d 575. We granted certiorari, 360 U.S. 916, 79 S.Ct. 1432, 3 L.Ed.2d 1532, because of the importance of the question in the proper administration of the National Labor Relations Act. For reasons given in this opinion we hold that the complaints against these petitioners are barred by time.

We first note the opposing contentions of the parties. The Board starts with the premise that a collective bargaining agreement which contains a union security clause valid on its face, but which was entered into when the Union did not have a majority status, gives rise to two independent unfair labor practices, one being the execution of the agreement, the other arising from its continued enforcement. Conceding that a complaint predicated on the execution of the agreement here challenged was barred by limitations, the Board contends that its complaint was nonetheless timely since it was 'based upon' the parties' continued enforcement, within the period of limitations, of the union security clause. It is then said that even though the former was itself time-barred, the unlawful execution of the agreement was nevertheless 'relevant in determining whether conduct within the 6-month period was unlawful,' 119 N.L.R.B., at 504; and that evidence as to it was admissible because § 10(b) is a statute of limitations, and not a rule of evidence.

On the other hand, petitioners contend that, standing alone, the union security clause and its enforcement were wholly innocent; that they were tainted only by virtue of the original unlawful execution of the agreement; and that since a complaint based upon that unfair labor practice was barred by limitations, that event itself could not be utilized to infuse with illegality the otherwise legal union security clause or its enforcement. They say, in short, that to apply in this situation the doctrine that § 10(b) is a statute of limitations, and not a rule of evidence, is to circumvent the purposes of the section, and that acceptance of the Board's position would mean that the statute of limitations would never run in a case of this kind. We think petitioners' position represents the correct view of the matter.

It is doubtless true that § 10(b) does not prevent all use of evidence relating to events transpiring more than six months before the filing and service of an unfair labor practice charge. However, in applying rules of evidence as to the admissibility of past events, due regard for the purposes of § 10(b) requires that two different kinds of situations be distinguished. The first is one where occurrences within the six-month limitations period in and of themselves may constitute, as a substantive matter, unfair labor practices. There, earlier events may be utilized to shed light on the true character of matters occurring within the limitations period; and for that purpose § 10(b) ordinarily does not bar such evidentiary use of anterior events. The second situation is that where conduct occurring within the limitations period can be charged to be an unfair labor practice only through reliance on an earlier unfair labor practice. There the use of the earlier unfair labor practice is not merely 'evidentiary,' since it does not simply lay bare a putative current unfair labor practice. Rather, it serves to cloak with illegality that which was otherwise lawful. And where a complaint based upon that earlier event is time-barred, to permit the event itself to be so used in effect results in reviving a legally defunct unfair labor practice.

The situation before us is of this latter variety, for the entire foundation of the unfair labor practice charged was the Union's time-barred lack of majority status when the original collective bargaining agreement was signed. In the absence of that fact enforcement of this otherwise valid union security clause was wholly benign. The Trial Examiner, whose findings were adopted by the Board, observed:

'The General Counsel concedes that the 6-month limitation of     Section 10(b) of the Act precludes currently finding the      execution of the 1954 agreement to be an unfair labor      practice, and also precludes currently finding its      enforcement to be an unfair labor practice *  *  * at any time      prior to the *  *  * periods beginning 6 months prior to the *      *  * charges *  *  *. However, this concession in no way     detracts from the crucial nature of the earlier events,      because at the core of the General Counsel's contentions as      to all of the unfair labor practices is his fundamental      position that, because of the circumstances prevailing when      made, the original union-security agreement of 1954 has never      been valid or legal, since it has never met certain      overriding requirements of Section 8(a)(3) of the Act.' 119      N.L.R.B., at 530. (Emphasis added, except as indicated.)

Where, as here, a collective bargaining agreement and its enforcement are both perfectly lawful on the face of things, and an unfair labor practice cannot be made out except by reliance on the fact of the agreement's original unlawful execution, an event which, because of limitations, cannot itself be made the subject of an unfair labor practice complaint, we think that permitting resort to the principle that § 10(b) is not a rule of evidence, in order to convert what is otherwise legal into something illegal, would vitiate the policies underlying that section. These policies are to bar litigation over past events 'after records have been destroyed, witnesses have gone elsewhere, and recollections of the events in question have become dim and confused,' H.R.Rep.No. 245, 80th Cong., 1st Sess., p. 40, and of course to stabilize existing bargaining relationships.

Our view of the matter is lent support by the attitude of the Board itself, whose previous decisions, albeit not always with unanimity among its members or even perhaps with perfect consistency, have recognized that evidentiary rules as to past events must be regarded differently in the two situations we have already depicted. Compare, e.g., Potlatch Forests, Inc., 87 N.L.R.B. 1193, where evidence as to events during the barred period was used to illuminate current conduct claimed in itself to be an unfair labor practice, with Bowen Products Corp., 113 N.L.R.B. 731, and Greenville Cotton Oil Co., 92 N.L.R.B. 1033, affirmed sub nom. American Federation of Grain Millers, A.F.L. v. National Labor Relations Board, 5 Cir., 197 F.2d 451, where the gravamen of the unfair labor practice complained of lay in a fact or event occurring during the barred period.

Indeed, some Board cases have gone even further and held § 10(b) a bar in circumstances when, although none of the material elements of the charge in a timely complaint need necessarily be proved through reference to the barred period-so that utilization of evidence from that period is ostensibly only for the purpose of giving color to what is involved in the complaint-yet the evidence in fact marshalled from within the six-month period is not substantial, and the merit of the allegations in the complaint is shown largely by reliance on the earlier events. See, e.g., News Printing Co., 116 N.L.R.B. 210, 212; Universal Oil Products Co., 108 N.L.R.B. 68; Tennessee Knitting Mills, Inc., 88 N.L.R.B. 1103. However, we express no view on the problem raised by such cases, for here we need not go beyond saying that a finding of violation which is inescapably grounded on events predating the limitations period is directly at odds with the purposes of the § 10(b) proviso.

The applicability of these principles cannot be avoided here by invoking the doctrine of continuing violation. It may be conceded that the continued enforcement, as well as the execution, of this collective bargaining agreement constitutes an unfair labor practice, and that these are two logically separate violations, independent in the sense that they can be described in discrete terms. Nevertheless, the vice in the enforcement of this agreement is manifestly not independent of the legality of its execution, as would be the case, for example, with an agreement invalid on its face or with one validly executed, but unlawfully administered. As the dissenting Board members in this case recognized, in dealing with an agreement claimed to be void by reason of the union's lack of majority status at the time of its execution,

' * *  * the circumstances which cause the agreement to be      invalid existed only at the point in time in the past when      the agreement was executed and are not thereafter repeated. For this reason, therefore, the continuing invalidity of the     agreement is directly related to and is based solely on its      initial invalidity, and has no continuing independent basis.'      119 N.L.R.B., at 516.

In any real sense, then, the complaints in this case are 'based upon' the unlawful execution of the agreement, for its enforcement, though continuing, is a continuing violation solely by reason of circumstances existing only at the date of execution. To justify reliance on those circumstances on the ground that the maintenance in effect of the agreement is a continuing violation is to support a lifting of the limitations bar by a characterization which becomes apt only when that bar has already been lifted. Put another way, if the § 10(b) proviso is to be given effect, the enforcement, as distinguished from the execution, of such an agreement as this constitutes a suable unfair labor practice only for six months following the making of the agreement.

The Board's ruling is further sought to be supported on the ground that it did not rest on a formal finding that the execution of the 1954 agreement constituted an unfair labor practice. The Court of Appeals, while stating that the Board could not draw 'any legal conclusion with regard to events outside the statutory period,' distinguished the decision here as resting on the 'mere existence (of the facts surrounding the making of the 1954 contract) rather than on ascribing legal significance to those facts standing alone.' 105 U.S.App.D.C. at page 108, 264 F.2d at page 581 (emphasis by the court). This distinction sacrifices the policy of the Act to procedural formalities. If, as is not disputable, the § 10(b) limitation was prompted by 'complaint that people were being brought to book upon stale charges,' National Labor Relations Board v. Pennwoven, Inc., 3 Cir., 194 F.2d 521, 524, it is a particular use of the prelimitations facts or conduct at which the section is aimed, and it can hardly be thought relevant that the proscribed use has not been labeled as such. The applicability of the policy of § 10(b) in the Grain Millers case, supra, where in the particular circumstances of that case, and not because of anything arising from § 10(b), the challenged acts within the limitations period could not be condemned as unlawful without an express declaration that earlier conduct constituted an unfair labor practice (see note 12, ante), was not greater than it is here, where although there was no 'finding' that execution of the agreement constituted an unfair labor practice, it is manifest that were that not in fact the case enforcement of the agreement would carry no taint of illegality. The availability of the repose sought to be assured by § 10(b) cannot turn on the vagaries of any such hypertechnical distinctions, bearing no relation to the purpose of the legislation.

It is apparently not disputed that the Board's position would withdraw virtually all limitations protection from collective bargaining agreements attacked on the ground asserted here. For, once the principle on which the decision below rests is accepted, so long as the contract-or any renewal thereof-is still in effect, the six-month period does not even begin to run. Cf. Bowen Products Corp., supra, at 732. In Lively Photos, Inc., 123 N.L.R.B. 1054, the Board unhesitatingly applied the doctrine of the case at bar to an attack upon an agreement executed more than three and one-half years prior to the filing of the charge. The cease-and-desist order entered in that case directed the severance of a bargaining relationship which had been initiated five years earlier. A doctrine which does such disservice to stability of bargaining relationships could be upheld, in light of the language and evident purpose of § 10(b), only by a convincing showing that Congress did not intend that provision to be applied so as to bar attacks on collective agreements with unions lacking majority status unless brought within six months of their execution. Far from providing such a showing, the legislative history contains affirmative evidence that Congress was specifically advertent to the problem of agreements with minority unions, had previously been at pains to protect such agreements from belated attack, and manifested an intention, in enacting § 10(b), not to withdraw that protection.

Four years prior to the enactment of the Taft-Hartley amendments, of which the § 10(b) limitations proviso was one, Congress barred the Board from proceeding, under certain conditions not here relevant, in cases 'arising over an agreement between management and labor which has been in existence for three months or longer without complaint being filed.' National Labor Relations Board Appropriation Act, 1944, 57 Stat. 515. This legislation was enacted with specific reference to agreements with minority unions, and was re-enacted in each succeeding session through 1947. At the time the Senate Committee on Labor and Public Welfare reported S. 1126 (the Senate version of the proposed legislation enacted as the Labor Management Relations Act, 1947), a rider to the appropriations bill for the fiscal year 1948 (H.R. 2700, 80th Cong., 1st Sess.) was pending before the Senate Appropriations Committee, having been previously reported by the House Appropriations Committee in language identical with that of its predecessors. The Labor Committee's discussion of the proposed § 10(b) amendment is illuminating:

'The principal substantive change in this section is a     provision for a 6-month period of limitations upon the filing      of charges. The Board itself by adopting a doctrine of laches     has to some extent discouraged dilatory filing of charges,      and a rider to the current appropriations bill (which if this      amendment was adopted would no longer be necessary) contains      a 3-month period of limitations with respect to certain kinds      of unfair labor practices.' S.Rep.No.105, 80th Cong. 1st     Sess., p. 26. (Emphasis added.)

This language cannot be squared with an interpretation of § 10(b) which would ascribe to Congress, in enacting for the first time a general limitations provision, a purpose to eliminate the then-existing all-embracing limitation specifically applicable to agreements with minority unions.

In sustaining the Board's position, the Court of Appeals also relied on the public character of the right sought to be vindicated by the Board, and the limited scope of judicial review of Board determinations. Observing that 'in interpreting, applying and administering a statute of limitations prescribed by Congress in this context (the field of labor relations), the Board-and the courts-are not confronted by precisely the same considerations as apply to statutes of limitations affecting the private rights of two individual litigants,' the Court reasoned that '(t)he Board may have thought that the interests of (employee) self determination outweighed otherwise important competing considerations of burying stale disputes.' 105 U.S.App.D.C. at pages 108-109, 264 F.2d, at pages 581-582. We think this analysis inadmissible here, for the reason that the accommodation between these competing factors has already been made by Congress. It is a commonplace, but one too easily lost sight of, that labor legislation traditionally entails the adjustment and compromise of competing interests which in the abstract or from a purely partisan point of view may seem irreconcilable. The 'police of the Act' is embodied in the totality of that adjustment, and not necessarily in any single demand which may have figured, however weightily, in it. Cf. note 7, ante. It may be asserted, without fear of contradiction, that the interest in employee freedom of choice is one of those given large recognition by the Act as amended. But neither can one disregard the interest in 'industrial peace which it is the overall purpose of the Act to secure.' National Labor Relations Board v. Childs Co., 2 Cir., 195 F.2d 617, 621-622 (concurring opinion of L. Hand, J.). Cf. Colgate-Palmolive Peet Co. v. National Labor Relations Board, 338 U.S. 355, 362-363, 70 S.Ct. 166, 170, 94 L.Ed. 161. As expositor of the national interest, Congress, in the judgment that a six-month limitations period did 'not seem unreasonable,' H.R.Rep.No. 245, 80th Cong., 1st Sess., p. 40, barred the Board from dealing with past conduct after that period had run, even at the expense of the vindication of statutory rights. 'It is not necessary for us to justify the policy of Congress. It is enough that we find it in the statute. That policy cannot be defeated by the Board's policy * *  * .' Colgate-Palmolive Peet Co. v. National Labor Relations Board, supra, 338 U.S. at page 363, 70 S.Ct. at page 171. Cf. Southern S.S.C.o. v. National Labor Relations Board, 316 U.S. 31, 47, 62 S.Ct. 886, 894, 86 L.Ed. 1246.

Reversed.

Mr. Justice FRANKFURTER, dissenting.