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National Labor Relations Board v. Great Atlantic & Pacific Tea Co.

January 14, 1965


Author: Kaufman

Before WATERMAN, MOORE and KAUFMAN, Circuit Judges.


In rather rapid succession, we are called upon once again to decide whether certain conduct violated the proscription in the National Labor Relations Act against encouragement or discouragement of "membership in any labor organization" "by discrimination in regard to hire or tenure of employment or any term or condition of employment." Section 8(a)(3), 29 U.S.C. ยง 158(a)(3). See NLRB v. Local 50, American Bakery Workers, - F.2d - (2d Cir. 1964). The National Labor Relations Board petitions for enforcement of its order based upon findings that the Great Atlantic & Pacific Tea Co., P & C Food Markets, Inc., and American Stores Company (collectively, "the respondents") violated Section 8(a)(3) and (1). The respondents have cross-petitioned to set aside one portion of the Board's order.

The Board approved its trial examiner's findings and conclusions that the respondents committed an unfair labor practice by threatening to lock out and by locking out their store employees, members of District Union Local 1, Amalgamated Meat Cutters & Butchers Workmen of America, AFL-CIO ("Meat Cutters"), in response to a Meat Cutters strike against another chain of retail food stores (Loblaw, Inc.). We enforce this portion of the Board's order,*fn1 not contested by the respondents. But the Board also found an unfair labor practice, contrary to the trial examiner's findings and conclusion, in the consequential layoffs of warehouse and bakery employees ("service employees")*fn2 because of lack of work caused by the lockout of store employees. We agree with the respondents that this latter finding must be set aside for lack of any evidence that the respondents either intended to discriminate on the basis of union membership or activities, or that their conduct had an effect of discouraging such membership or activities.

While the respondents do not challenge the Board's order respecting the lockout of store employees, it is necessary that we set for the relevant facts which led the Board to hold the lockout unlawful - albeit summarily - because of their pertinence to the remaining issue before us. For many years the respondents bargained individually with the Meat Cutters as the representative of all their store employees, including cashiers and stock clerks as well as butchers, in the Syracuse, New York, area. At the time the dispute which led to the proceedings occurred, the Meat Cutters' contracts with the respondents and with Loblaw were scheduled to expire at various dates in April 1961. Before the expiration dates, however, the respondents, together with Loblaw and two other retail food chains, determined that multi-employer bargaining should replace separate negotiations with the Meat Cutters.As a result, they organized the Food Employers Labor Council of Syracuse for this purpose.

Although the Meat Cutters exchanged contract proposals with the Council, negotiations soon ran aground because the union denied that it had recognized the Council as the industry-wide bargaining agent. After several heated confrontations, it became apparent that industry-wide agreement was impossible and, so, the Meat Cutters announced they were striking Loblaw, whose contract had by that time expired. The food chains warned that if Loblaw was struck, all other Council members would close their stores to protect the solidarity of what they believed to be a legitimate multi-employer unit from the effect of the "whip-saw" strike against Loblaw.

Both sides remained firm and the respondents soon closed down their stores. An unfortunate by-product of the shutdown was that the warehouse and bakery employees, who concededly were not involved in the dispute between the employers and the Meat Cutters, were left without work to perform, except for some minor operations, and within a few days their layoff followed. When the Meat Cutters' dispute was ultimately settled, all laid off and locked out employees returned to work. Upon charges soon filed by individual store employees and the unions representing the service employees, the General Counsel issued complaints alleging that respondents had violated Section 8(a)(3) and (1).

I. Initially, we have no difficulty endorsing the Board's conclusion that respondents' lockout of store employees represented by the Meat Cutters in response to the Loblaw strike was unlawful. The respondents concede that substantial evidence supported the trial ex aminer's finding that the Union had not agreed - except to the extent of participation in negotiations - to a multi-employer unit. This takes the instant dispute outside that class of defensive lockouts sheltered by the Supreme Court's Buffalo Linen decision, NLRB v. Truck Drivers Union, 353 U.S. 87, 1 L. Ed. 2d 676, 77 S. Ct. 643 (1957), upholding the validity of a lockout employed defensively to preserve the integrity of a recognized multi-employer unit. But, here, since the Meat Cutters had not, either by word or deed, committed themselves to industrywide bargaining, the food chains' conduct lost the protective quality which justified the Buffalo Linen lockout and, instead, assumed the character of an offensive weapon which would unfairly advantage the employers in their demands for a multi-employer unit. See Body & Tank Corp. v. NLRB, - F.2d - (2d Cir. 1964); Quaker State Oil Refining Corp. v. NLRB, 270 F.2d 40 (3d Cir.), cert. denied, 361 U.S. 917, 4 L. Ed. 2d 185, 80 S. Ct. 261 (1959).*fn3 The Board properly found, therefore, that this conduct violated Section 8(a)(3) and (1).

II. But, we cannot accept the Board's wholly conclusory holding, without any evidentiary basis whatsoever, that the incidental layoffs of warehousemen and bakers also violated Section 8(a)(3) and (1). We have come to this determination because we find nothing in the record to establish the two elements vital to a finding that the respondents unlawfully discriminated against the service employees. There is not a scintilla of evidence establishing either (a) that the food chains intended to discriminate on the basis of union membership or activities or (b) that an effect of the layoffs was to discourage such membership or activities. See Local 357, I.B.T. v. NLRB, 365 U.S. 667, 6 L. Ed. 2d 11, 81 S. Ct. 835 (1961); NLRB v. Miranda Fuel Co ., 326 F.2d 172 (2d Cir. 1963); Quality Castings Co. v. NLRB, 325 F.2d 36 (6th Cir. 1963); Pittsburgh-Des Moines Steel Co. v. NLRB, 284 F.2d 74 (9th Cir. 1960).

Looking to the Supreme Court for our guidance in this developing area of the law, we observe that it has consistently recognized that the employer's intent or motive in acting discriminatorily is an important factor to be considered in Section 8(a)(3) cases. Radio Officers' Union v. NLRB, 347 U.S. 17, 42-44, 98 L. Ed. 455, 74 S. Ct. 323 (1954); NLRB v. Erie Resistor Corp ., 373 U.S. 221, 227, 10 L. Ed. 2d 308, 83 S. Ct. 1139 (1963). Indeed, it noted recently that "the 'true purpose' or 'real motive' . . . constitutes the test of whether there is unlawful encouragement or discouragement of union membership by discriminatory action." Local 357, I.B.T. v. NLRB, 365 U.S. 667, 675, 6 L. Ed. 2d 11, 81 S. Ct. 835 (1961). Adapting this precept to the present case, there is nothing before us from which we can reasonably determine that the "real motive" of the respondents was discriminatory. We are not unmindful, in this connection, of the stipulation in the record that the layoff of service employees was due solely to lack of work resulting from the store shutdowns, and, that there was no labor dispute between the food chains and the unions representing these employees. Indeed, it is clear that when there was work to be done in the warehouses during the shutdowns, employees were retained for that purpose.

The Board seeks to vault these barriers and discharge its burden of proving the statutorily required discrimination against the bakers and warehousemen by picturing their layoff as the inevitable result of the unlawful Meat Cutter lockout. But, such an approach is too facile and effectively reads the re quired showing of "motivation" out of the statute. Assuming, arguendo, that the respondents reasonably anticipated that a lockout of Meat Cutters could ultimately lead to a layoff of other employees, this would, nevertheless, fall short of establishing that they were motivated by a desire to discriminate against the service employees. Foreseeability is not the equivalent of discriminatory motivation.*fn4

We recognize that there are instances, indeed, where the Board need not present specific proof of improper intent or motive. See Radio Officers Union v. NLRB, 347 U.S. 17, 98 L. Ed. 455, 74 S. Ct. 323 (1954); NLRB v. Erie Resistor Corp ., 373 U.S. 221, 10 L. Ed. 2d 308, 83 S. Ct. 1139 (1963). But, we should note that the Radio Officers' case was limited by the Supreme Court to situations where the employer's conduct is "inherently" discriminatory. 347 U.S. at 45, 48.*fn5 When union-membership considerations form the basis of an employer's action against certain employees, the likelihood that protected union activities will be encouraged or discouraged is so great that improper motivation will be presumed without direct proof.

The exception, however, cannot swallow the rule. The restricted scope of the inherently-discriminatory principle is illustrated by Quality Castings Co. v. NLRB, 325 F.2d 36 (6th Cir. 1963). There, the Board held that an employer profit-sharing plan was discriminatory because it excluded from participation employees who had not worked one-half the scheduled working time during a given period. The Board urged that the Radio Officers' rule was applicable since the employer must have foreseen that he would exclude from participation many employees who had engaged in a protracted strike during the measuring period. We agree with the Sixth Circuit Court of Appeals in its refusal to apply the inherently-discriminatory exception to excuse a failure of direct proof of improper motivation. "When an employer's action is not specifically directed against those who have engaged in protected types of union activity," the court declared, "but is rather directed at a group which is defined by other than union membership or activity criteria, and which clearly includes others who did not engage in the protected, concerted activities, the Board not only must prove discrimination but also it must prove the employer's motivation." 325 F.2d at 41.*fn6

An employer's activity is "inherently discriminatory" under the Radio Officers' doctrine when it rewards or punishes employees because of their union membership or activities. Thus, in NLRB v. Local 50, American Bakery Workers, - F.2d - (2d Cir. 1964), we recently held that specific proof of unlawful motivation was unnecessary where an employee lost his seniority rights simply because he had taken out a withdrawal card from his union. And it was inherently discriminatory in Erie Resistor, supra, to award an unearned ...

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