National Labor Relations Board v. Allis-Chalmers Manufacturing Company/Opinion of the Court

The question here is whether a union which threatened and imposed fines, and brought suit for their collection, against members who crossed the union's picket line and went to work during an authorized strike against their employer, committed the unfair labor practice under § 8(b)(1)(A) of the National Labor Relations Act of engaging in conduct 'to restrain or coerce' employees in the exercise of their right guaranteed by § 7 to 'refrain from' concerted activities.

Employees at the West Allis, and La Crosse, Wisconsin, plants of respondent Allis-Chalmers Manufacturing Company were represented by locals of the United Automobile Workers. Lawful economic strikes were conducted at both plants in support of new contract demands. In compliance with the UAW constitution, the strikes were called with the approval of the International Union after at least two-thirds of the members of each local voted by secret ballot to strike. Some members of each local crossed the picket lines and worked during the strikes. After the strikes were over, the locals brought proceedings against these members charging them with violation of the International constitution and bylaws. The charges were heard by local trial committees in proceedings at which the charged members were respresented by counsel. No claim of unfairness in the proceedings is made. The trials resulted in each charged member being found guilty of 'conduct unbecoming a Unionmember' and being fined in a sum from $20 to $100. Some of the fined members did not pay the fines and one of the locals obtained a judgment in the amount of the fine against one of its members, Benjamin Natzke, in a test suit brought in the Milwaukee County Court. An appeal from the judgment is pending in the

Allis-Chalmers filed unfair labor practice Wisconsin Supreme Court.

Allis-Chalmers filed unfair labor practice violation of § 8(b)(1)(A). A complaint issued and after hearing a trial examiner recommended its dismissal. The National Labor Relations Board sustained the examiner on the ground that, in the circumstances of this case, the actions of the locals, even if restraint or coercion prohibited by § 8(b)(1)(A), constituted conduct excepted from the section's prohibitions by the proviso that such prohibitions 'shall not impair the right of a labor organization to prescribe its own rules with respect to the acquisition or retention of membership therein.' 149 N.L.R.B. 67. Upon Allis-Chalmers' petition for review to the Court of Appeals for the Seventh Circuit, a panel of that court upheld the Board's decision. Following a rehearing en banc, however, the court, three judges dissenting, withdrew the panel opinion, held that the locals' conduct violated § 8(b)(1)(A), and remanded to the Board for appropriate proceedings. 358 F.2d 656. We granted certiorari, 385 U.S. 810, 87 S.Ct. 54, 17 L.Ed.2d 51. We reverse.

The panel and the majority en banc of the Court of Appeals thought that reversal of the NLRB orde w ould be required under a literal reading of §§ 7 and 8(b)(1)(A); under that reading union members who cross their own picket lines would be regarded as exercising their rights under § 7 to refrain from engaging in a particular concerted activity, and union discipline in the form of fines for such activity would therefore 'restrain or coerce' in violation of § 8(b)(1)(A) if the section's proviso is read to sanction no form of discipline other than expulsion from the union. The panel rejected that literal reading. The majority en banc adopted it, stating that the panel 'mistakenly took the position that such a literal reading was unwarranted in the light of the history and purposes' of the sections, 358 F.2d, at 659, and holding that '(T) he statutes in question present no ambiguities whatsoever, and therefore do not require recourse to legislative history for clarification.' Id., at 660.

It is highly unrealistic to regard § 8(b)(1), and particularly its words 'restrain or coerce,' as precisely and unambiguously covering the union conduct involved in this case. On its face court enforcement of fines imposed on members for violation of membership obligations is no more conduct to 'restrain or coerce' satisfaction of such obligations than court enforcement of penalties imposed on citizens for violation of their obligations as citizens to pay income taxes, or court awards of damages against a contracting party for nonperformance of a contractual obligation voluntarily undertaken. But even if the inherent imprecision of the words 'restrain or coerce' may be overlooked, recourse to legislative history to determine the sense in which Congress used the words is not foreclosed. We have only this Term again admonished that labor legislation is peculiarly the product of legislative compromise of strongly held views, Local 1976, United Broth. of Carpenters and Joiners of America v. National Labor Relations Board, 357 U.S. 93, 99-100, 78 S.Ct. 1011, 1016-1017, 2 L.Ed.2d 1186, and that legislative history may not be disregarded merely because it is arguable that a provision may unambiguously embrace conduct called in question. National Woodworkers Mfrs. Assn. v. NLRB, 386 U.S. 612, 619-620, 87 S.Ct. 1250, 1266, 18 L.Ed.2d 357. Indeed, we have applied that principle to the construction of § 8(b)(1)(A) itself in holding that the section must be construed in light of the fact that it 'is only one of many interwoven sections in a complex Act, mindful of the manifest purpose of the Congress to fashion a coherent national labor policy.' National Labor Relations Board v. Drivers, etc., Local Union No. 639, 362 U.S. 274, 292, 80 S.Ct. 706, 716, 4 L.Ed.2d 710.

National labor policy has been built on the premise that by pooling their economic strength and acting through a labor organization freely chosen by the majority, the employees of an appropriate unit have the most effective means of bargaining for improvements in wages, hours, and working conditions. The policy therefore extinguishes the individual employee's power to order his own relations with his employer and creates a power vested in the chosen representative to act in the interests of all employees. 'Congress has seen fit to clothe the bargaining representative with powers comparable to those possessed by a legislative body both to create and restrict the rights of those whom it represents * *  * .' Steele v. Louisville & N.R. Co., 323 U.S. 192, 202, 65 S.Ct. 226, 232, 89 L.Ed. 173. Thus only the union may contract the employee's terms and conditions of employment, and provisions for processing his grievances; the union may even bargain away his right to strike during the contract term, and his right to refuse to cross a lawful picket line. The employee may disagree with many of the union decisions but is bound by them. 'The majority-rule concept is today unquestionably at the center of our federal labor policy.' 'The complete satisfaction of all who are represented is hardly to be expected. A wide rng e of reasonableness must be allowed a statutory bargaining representative in serving the unit it represents, subject always to complete good faith and honesty of purpose in the exercise of its discretion.' Ford Motor Co. v. Huffman, 345 U.S. 330, 338, 73 S.Ct. 681, 686, 97 L.Ed. 1048.

It was because the national labor policy vested unions with power to order the relations of employees with their employer that this Court found it necessary to fashion the duty of fair representation. That duty 'has stood as a bulwark to prevent arbitrary union conduct against individuals stripped of traditional forms of redress by the provisions of federal labor law.' Vaca v. Sipes, 386 U.S. 171, 182, 87 S.Ct. 903, 912, 17 L.Ed.2d 842. For the same reason Congress in the 1959 Landrum-Griffin amendments, 73 Stat. 519, enacted a code of fairness to assure democratic conduct of union affairs by provisions guaranteeing free speech and assembly, equal rights to vote in elections, to attend meetings, and to participate in the deliberations and voting upon the business conducted at the meetings.

Integral to this federal labor policy has been the power in the chosen union to protect against erosion its status under that policy through reasonable discipline of members who violate rules and regulations governing membership. That power is particularly vital when the members engage in strikes. The economic strike against the employer is the ultimate weapon in labor's arsenal for achieving agreement upon its terms, and '(t)he power to fine or expel strikebreakers is essential if the union is to be an effective bargaining agent * *  * .' Provisions in union constitutions and bylaws for fines and expulsion of recalcitrants, including strikebreakers, are therefore common-place and were commonplace at the time of the Taft-Hartley amendments.

In addition, the judicial view current at the time § 8(b)(1)(A) was passed was that provisions defining punishable conduct and the procedures for trial and appeal constituted part of the contract between member and union and that 'The courts' role is but to enforce the contract.' In International Association of Machinists v. Gonzales, 356 U.S. 617, 618, 78 S.Ct. 923, 924, 2 L.Ed.2d 1018, we recognized that '(t)his contractual conception of the relation between a member and his union widely prevails in this country * *  * .' Although state courts were reluctant to intervene in internal union affairs, a body of law establishing standards of fairness in the enforcement of union discipline grew up around this contract doctrine. See Parks v. International Broth. of Electrical Workers, 4 Cir., 314 F.2d 886, 902-903.

To say that Congress meant in 1947 by the § 7 amendments and § 8(b)(1)(A) to strip unions of the power to fine members for strikebreaking, however lawful the strike vote, and however fair the disciplinary procedures and penalty, is to say that Congress preceded the Landrum-Griffin amendments with an even more pervasive regulation of the internal affairs of unions. It is also to attribute to Congress an intent at war with the understanding of the union-membership relation which has been at the heart of its effort 'to fashion a coherent labor policy' and which has been a predicate underlying action by this Court and the state courts. More importantly, it is to say that Congress limited unions in the powers necessary to the discharge of their role as exclusive statutory bargaining agents by impairing the usefulness of labor's cherished strike weapon. It is no answer that the proviso to § 8(b)(1)(A) preserves to the union the power to expel the offending member. Where the union is strong and membership therefore valuable, to require expulsion of the member visits a far more severe penalty upon the member than a reasonable fine. Where the union is weak, and membership therefore of little value, the union faced with further depletion of its ranks may have no real choice except to condone the member's disobedience. Yet it is just such weak unions for which the power to execute union decisions taken for the benefit of all employees is most critical to effective discharge of its statutory function.

Congressional meaning is of course ordinarily to be discerned in the words Congress uses. But when the literal application of the imprecise words 'restrain or coerce' Congress employed in § 8(b)(1)(A) produces the extraordinary results we have meti oned we should determine whether this meaning is confirmed in the legislative history of the section.

The explicit wording of § 8(b)(2), which is concerned with union powers to affect a member's employment, is in sharp contrast with the imprecise words of § 8(b)(1)(A). Section 8(b)(2) limits union power to compel an employer to discharge a terminated member other than for 'failure (of the employee) to tender the periodic dues and the initiation fees uniformly required as a condition of acquiring or retaining membership.' It is significant that Congress expressly disclaimed in this connection any intention to interfere with union self-government or to regulate a union's internal affairs. The Senate Report stated:

'The committee did not desire to limit the labor organization     with respect to either its selection of membership or      expulsion therefrom. But the committee did wish to protect     the employee in his job if unreasonably expelled or denied      membership. The tests provided by the amendment are based     upon facts readily ascertainable and do not require the employer to inquire into the internal affairs of the      union.' S.Rep.No.105, 80th Cong., 1st Sess., 20, I      Legislative History of the Labor Management Relations Act,      1947 (hereafter Leg.Hist.) p. 426. (Emphasis supplied.)

Senator Taft, in answer to protestations by Senator Pepper that § 8(b)(2) would intervene in the union's internal affairs and 'deny it the right to protect itself against a man in the union who betrays the objectives of the union * *  * ,' stated:

'The pending measure does not propose any limitation with     respect to the internal affairs of unions. They still will be     able to fire any members they wish to fire, and they still      will be able to try any of their members. All that they will     not be able to do, after the enactment of this bill, is this:      If they fire a member for some reason other than nonpayment      of dues they cannot make his employer discharge him from his      job and throw him out of work. That is the only result of the     provision under discussion.' (Emphasis supplied.)

Section 8(b)(1)(A) was under consideration when Senator Taft said this. Congressional emphasis that § 8(b)(2) insulated an employee's membership from his job, but left internal union affairs to union self-government, is therefore significant evidence against reading § 8(b)(1)(A) as contemplating regulation of internal discipline. This is borne out by the fact that provision was also made in the Taft-Hartley Act for a special committee to study, among other things, 'the internal organization and administration of labor unions * *  * .' § 402(3), 61 Stat. 160.

What legislative materials there are dealing with § 8(b)(1)(A) contain not a single word referring to the application of its prohibitions to traditional internal union discipline in general, or disciplinary fines in particular. On the contrary there are a number of assurances by its sponsors that the section was not meant to regulate in internal affairs of unions.

The provision was not contained in the Senate or House bills reported out of committee, but was introduced as an amendment on the Senate floor by Senator Ball. The amendment was adopted in the Conference Committee, without significant enlightenment from the report of that committee. The first suggestion that restraint or coercion of employees in the exercise of § 7 rights should be an unfair labor practice appears in the Statement of Supplemental Views to the Senate Report, in which a minority of the Senate Committee, including Senators Ball, Taft, and Smith, concurred. The mischief against which the Statement inveighed was restraint and coercion by unions in organizational campaigns. 'The committee heard many instances of union coercion of employees such as that brought about by threats of reprisal against employees and their families in the course of organizing campaigns; also direct interference by mass picketing and other violence.' S.Rep.No.105, supra, a 5 0, I Leg.Hist. 456. Senator Ball proposed § 8(b)(1)(A) as an amendment to the Senate bill, and stated, 'The purpose of the amendment is simply to provide that where unions, in their organizational campaigns, indulge in practices which, if an employer indulged in them, would be unfair labor practices, such as making threats or false promises or false statements, the unions also shall be guilty of unfair labor practices.' 93 Cong.Rec. 4016, II Leg.Hist. 1018. Senator Ball gave numerous examples of the kind of union conduct the amendment was to cover. Each one related to union conduct during organizational campaigns. Senator Ball reiterated this purpose several times thereafter, including remarks added after passage of the amendment. The consistent thrust of his arguments was the necessity of controlling union conduct in organizational campaigns. Indeed, when Senator Holland introduced the proviso eliminating from the reach of § 8(b)(1)(A) 'the right of a labor organization to prescribe its own rules with respect to the acquisition or retention of membership * *  * ,' Senator Ball replied,

'I merely wish to state to the Senate that the amendment     offered by the Senator from Florida is perfectly agreeable to      me. It was never the intention of the sponsors of the pending     amendment to interfere with the internal affairs or      organization of unions.' (Emphasis supplied.)

After acceptance of the proviso, and on the same day as the vote on the amendment itself, Senator Ball said of the proviso: 'That modification is designed to make it clear that we are not trying to interfere with the internal affairs of a union which is already organized. All we are trying to cover is the coercive and restraining acts of the union in its effort to organize unorganized employees.'

Another co-sponsor of the amendment, Senator Smith, echoed this purpose: 'The pending measure is designed to protect employees in their freedom to decide whether or not they desire to join labor organizations, to prevent them from being restrained or coerced.'

Senator Taft also initially confined his comments on the amendment to examples of organizational tactics. However, in debate with Senator Pepper, he suggested a broader but still limited application:

'If there is anything clear in the development of labor union     history in the past 10 years it is that more and more labor      union employees have come to be subject to the orders of      labor union leaders. The bill provides for the right to     protest against arbitrary powers which have been exercised by      some of the labor union leaders.' (Emphasis supplied.)

In reply to Senator Pepper's protest that union members can protect themselves against such 'tyranny,' Senator Taft stated, 'I think it is fair to say that in the case of many of the unions, the employee has a good deal more of an opportunity to select his employer than he has to select his labor-union leader.' Senator Taft further observed that union leaders sometimes penalize those who vote against them. Senator Pepper then attempted to draw an analogy between union members and shareholders in a corporation, to which Senator Taft replied, 'The Congress has gone much further in protecting the rights of minority stockholders in corporations than it has in protecting the rights of members of unions. Even in this bill we do not tell the unions how they shall vote or how they shall conduct their affairs * *  * .' (Emphasis supplied.) Senator Pepper attempted twice to clarify the effect of the amendment on internal affairs, but Senator Taft answered only that the amendment applied to nonunion men as well.

It was one week after this debate between Senator Taft and Senator Pepper that § 8(b)(1)(A) was adopted by the Senate as an amendment to the bill. There was no further reference in the debates to the applicability of the section to internal union affairs, by Senator Taft or anyone else, despite the repeated statements by Senator Ball that it bore no relationship to the conduct of such affairs. At one point, Senator Saltonstall asked Senator Taft to provide examples of the kind of union conduct covered by the section. Senator Taft responded with examples of threats of bodily harm, economic coercion, and mass picketing in organizational campaigns and coercion which prevented employees not involved in a labor dispute from going to work. But any inference that Senator Taft envisioned that § 8(b)(1)(A) intruded into and regulated internal union affairs is negated by his categorical statements to the contrary in the contemporaneous debates on § 8(b)(2).

It is true that there are references in the Senate debate on § 8(b)(1)(A) to an intent to impose the same prohibitions on unions that applied to employers as regards restraint and coercion of employees in their exercise of § 7 rights. However apposite this parallel might be when applied to organizational tactics, it clearly is inapplicable to the relationship of a union member to his own union. Union membership allows the member a part in choosing the very course of action to which he refuses to adhere, but he has of course no role in employer conduct, and nonunion employees have no voice in the affairs of the union.

Cogent support for an interpretation of the body of § 8(b)(1) as not reaching the imposition of fines and attempts at court enforcement is the proviso to § 8(b)(1). It states that nothing in the section shall 'impair the right of a labor organization to prescribe its own rules with respect to the acquisition or retention of membership therein * *  * .' Senator Holland offered the proviso during debate and Senator Ball immediately accepted it, stating that it was not the intent of the sponsors in any way to regulate the internal affairs of unions. At the very least it can be said that the proviso preserves the rights of unions to impose fines, as a lesser penalty than expulsion, and to impose fines which carry the explicit or implicit threat of expulsion for nonpayment. Therefore, under the proviso the rule in the UAW constitution governing fines is valid and the fines themselves and expulsion for nonpayment would not be an unfair labor practice. Assuming that the proviso cannot also be read to authorize court enforcement of fines, a question we need not reach, the fact remains that to interpret the body of § 8(b)(1) to apply to the imposition and collection of fines would be to impute to Congress a concern with the permissible means of enforcement of union fines and to attribute to Congress a narrow and disre et interest in banning court enforcement of such fines. Yet there is not one word in the legislative history evidencing any such congressional concern. And, as we have pointed out, a distinction between court enforcement and expulsion would have been anomalous for several reasons. First, Congress was operating within the context of the 'contract theory' of the union-member relationship which widely prevailed at that time. The efficacy of a contract is precisely its legal enforceability. A lawsuit is and has been the ordinary way by which performance of private money obligations is compelled. Second, as we have noted, such a distinction would visit upon the member of a strong union a potentially more severe punishment than court enforcement of fines, while impairing the bargaining facility of the weak union by requiring it either to condone misconduct or deplete its ranks.

There may be concern that court enforcement may permit the collection of unreasonably large fines. However, even were there evidence that Congress shared this concern, this would not justify reading the Act also to bar court enforcement of reasonable fines.

The 1959 Landrum-Griffin amendments, thought to be the first comprehensive regulation by Congress of the conduct of internal union affairs, also negate the reach given § 8(b)(1)(A) by the majority en banc below. 'To de sure, what Congress did in 1959 does not establish what it meant in 1947. However, as another major step in an evolving pattern of regulation of union conduct, the 1959 Act is a relevant consideration. Courts may properly take into account the later Act when asked to extend the reach of the earlier Act's vague language to the limits which, read literally, the words might permit.' National Labor Relations Board v. Drivers, etc., Local Union No. 639, 362 U.S. 274, 291-292, 80 S.Ct. 706, 4 L.Ed.2d 710. In 1959 Congress did seek to protect union members in their relationship to the union by adopting measures to insure the provison of democratic processes in the conduct of union affairs and procedural due process to members subjected to discipline. Even then, some Senators emphasized that 'in establishing and enforcing statutory standards great care should be taen not to undermine union self-government or weaken unions in their role as collective-bargaining agents.' S.Rep.No.187, 86th Cong., 1st Sess., 7, U.S.Code Cong. & Admin.News 1959, p. 2318. The Eighty-sixth Congress was thus plainly of the view that self-government was not regulated in 1947. Indeed, that Congress expressly recognized that a union member may be 'fined, suspended, expelled, or otherwise disciplined,' and enacted only procedural requirements to be observed. 73 Stat. 523, 29 U.S.C. § 411(a)(5). Moreover, Congress added a proviso to the guarantee of freedom of speech and assembly disclaiming any intent 'to impair the right of a labor organization to adopt and enforce reasonable rules as to the responsibility of every member toward the organization as an institution * *  * .' 29 U.S.C. § 411(a)(2).

The 1959 provisions are significant for still another reason. We have seen that the only indication in the debates over § 8(b)(1)(A) of a reach beyond organizational tactics which restrain or coerce nonmembers was Senator Taft's concern with arbitrary and undemocratic union leadership. The 1959 amendments are addressed to that concern. The kind of regulation of internal union affairs which Senator Taft said protected stockholders of a corporation, and made necessary a 'right of protest against arbitrary powers which have been exercised by some of the labor union leaders.' is embodied in the 1959 Act. The requirements of adherence to democratic principles, fair procedures and freedom of speech apply to the election of union officials and extend into all aspects of union affairs. In the present case the procedures followed for calling the strikes and disciplining the recalcitrant members fully comported with these requirements, and were in every way fair and democratic. Whether § 8(b)(1)(A) proscribes arbitrary imposition of fines, or punishment for disobedience of a fiat of a union leader, are matters not presented by this case, and upon which we express no ivew.

Thus this history of congressional action does not support a conclusion that the Taft-Hartley prohibitions against restraint or coercion of an employee to refrain from concerted activities included a prohibition against the imposition of fines on members who decline to honor an authorized strike and attempts to collect such fines. Rather, the contrary inference is more jusitifed in light of the repeated refrain throughout the debates on § 8(b)(1)(A) and other sections that Congress did not propose any limitations with respect to the internal affairs of unions, aside from barring enforcement of a union's internal regulations to affect a member's employment status.

The collective bargaining agreements with the locals incorporate union security clauses. Full union membership is not compelled by the clauses: an employee is required only to become and remain 'a member of the Union * *  * to the extent of payng his monthly dues *  *  * .' The majority en banc below nevertheless regarded full membership to be 'the result not of individual voluntary choice but of the insertion of (this) union security provision in the contract under which a substantial minority of the employees may have been forced into membership.' 358 F.2d at 660. But the relevant inquiry here is not what motivated a member's full membership but whether the Taft-Hartley amendments prohibited disciplinary measures against a full member who crossed his union's picket line. It is clear that the fined employees involved herein enjoyed full union membership. Each executed the pledge of allegiance to the UAW constitution and took the oath of full membership. Moreover, the record of the Milwaukee County Court case against Benjamin Natzke discloses that two disciplined employees testified that they had fully participated in the proceedings leading to the strike. They attended the meetings at which the secret strike vote and the renewed strike vote were taken. It was upon this and similar evidence that the Milwaukee County Court found that Natzke 'had by his actions become a member of the union for all purposes * *  * .' Allis-Chalmers offered no evidence in this proceeding that any of the fined employees enjoyed other than full union membership. We will not presum the contrary. Cf. International Association of Machinists v. Street, 367 U.S. 740, 774, 81 S.Ct. 1784, 1787, 6 L.Ed.2d 1141. Indeed, it is and has been allis-Chalmers' position that the Taft-Hartley prohibitions apply whatever the nature of the membership. Whether those prohibitions would apply if the locals had imposed fines on members whose membership was in fact limited to the obligation of paying monthly dues is a question not before us and upon which we intimate no view.

The judgment of the Court of Appeals is reversed.

Reversed.