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July 24, 1979


The opinion of the court was delivered by: WEINFELD

Plaintiff, Transport Workers Union of America ("TWU"), commenced this action against Argentine Airlines (the "Company"), for injunctive relief restraining the Company from violating its obligation under the Railway Labor Act ("Act" or "RLA"), 45 U.S.C., sections 151 et seq., to bargain in good faith with the representative of its employees. *fn1" Specifically, TWU objected to the Company's proposal to exclude from contract coverage certain job classifications sales representatives, secretaries to various managers, and chief agents. The last collective bargaining agreement between the parties expired on August 31, 1978; negotiations failed to produce a new agreement; the mediation services of the National Mediation Board were exhausted; *fn2" and, following the thirty-day statutory waiting period, *fn3" TWU initiated a strike on May 11, 1979. Simultaneously with the filing of this action, plaintiff sought a preliminary injunction against the Company. After several days of hearings, the Court with the consent of the parties consolidated the hearing of the application for a preliminary injunction with the trial on the merits pursuant to Rule 65(a)(2) of the Federal Rules of Civil Procedure.

Two central issues emerged: (1) is the Company proposal to exclude specified job classifications from contract coverage a mandatory or non-mandatory subject of bargaining, and (2) if it is a non-mandatory subject, has the Company unlawfully insisted upon the proposal to impasse or made acceptance of the proposal a condition of agreement. Both parties draw an analogy to the distinction between mandatory and non-mandatory subjects of bargaining enunciated by the Supreme Court in NLRB v. Wooster Div. of Borg-Warner Corp., *fn4" for purposes of the National Labor Relations Act ("NLRA"). *fn5" As the Court there stated, the mandatory duty to bargain encompasses "the obligation of the employer and the representative of its employees to bargain with each other in good faith with respect to "wages, hours, and other terms and conditions of employment * * * .' The duty is limited to those subjects, and within that area neither party is legally obligated to yield." *fn6" As to other, non-mandatory, subjects, "each party is free to bargain or not to bargain, and to agree or not to agree. . . . But it does not follow that, because (either party) may propose (non-mandatory subjects), it can lawfully insist upon them as a condition to any agreement." *fn7" In sum, as to mandatory subjects, both parties must bargain but neither must yield. As to non-mandatory subjects, either party may make a proposal but the "proponent may not insist on its position to the point of impasse or as a condition of reaching an agreement, and the other party may decline to discuss the issue altogether without violating the law." *fn8"


 On February 13, 1958, the National Mediation Board ("Mediation Board") certified TWU as the representative of the Company's employees in three crafts or classes. The one at issue, the class of "Clerical, Office, Stores, Fleet and Passenger service employees," included 24 employees of whom one was a secretary and two were sales representatives. Among the remaining employees eligible to vote, a number bore the titles of "Traffic Agent," "Reservation Agent," and "Cargo Agent." *fn9" In Article 1(c) of the first collective bargaining agreement between the parties, *fn10" entered into in June 1958, a number of "managerial" positions were excluded from contract coverage, including the job entitled "Executive Secretary to General Manager." In addition, in Article 1(d), the job classification "Sales Representative" was excluded from the terms of the agreement relating to promotion, assignment and displacement, and overtime. Of the job classifications covered by the agreement, the general categories of "Traffic Agent" and "Cargo Agent" were broken out into "Chief Agent," "Lead Agent" and "Agent" positions. Similarly, there were three titles for "Accountant" Senior Accountant, Accountant and Accounting Clerk.

 As the work force expanded and new positions were created, the parties negotiated the inclusion and exclusion of additional classifications. In 1965, the Secretary to the Regional Manager was added to the Article 1(c) excluded positions and the Secretary to the District Sales Manager was partially excluded under Article 1(d). *fn11" In 1967, the Company recognized TWU as the bargaining agent for an additional craft or class, the Airline Purchasing Commission, which included three positions: Purchasing Commission Chief Agent, Purchasing Commission Accounting Agent, and Purchasing Commission Agent. The Secretary to the District Sales Manager was removed from the partial exclusion of Article 1(d). *fn12" In 1973, the category of "Reservation Agent," like the categories of Cargo and Traffic Agents before it, was broken out into "Chief," "Lead" and "Agent" positions. *fn13" In the last contract in 1976, Secretaries to District Sales Managers were again added to the Article 1(d) partial exclusions; the three titles in the Accounting category were changed to "Chief Accounting Agent," "Lead Accounting Agent," and "Accounting Agent"; and the position, "Senior Chief Traffic Agent (JFK only)," was added to coverage. *fn14"

 In the agreements from 1965 up to the 1976 contract, the Company reserved the right to create new or additional positions, in addition to those already completely or partially excluded from the contract in Article 1(c) and (d), "but in creating these new or additional positions the proper classifications and rates of pay of such positions shall be established by such agreement with the union, giving due recognition to Article 6C and 6D, and the determinations of the National Mediation Board, regarding "Official Positions' ". *fn15" Under Article 6C and 6D, which is also included in the 1976 contract, the Company retained the right to introduce new classifications; if the union objected to the classifications or the rates of pay for those classifications, it could process a grievance through the grievance procedures of the contract, including presentation to the System Board of Adjustment. *fn16" The Company agreed not to discontinue established positions and create new ones under a different title "for the purpose of reducing the rate of pay or evading the application of these articles." *fn17"

 Relying on this bargaining history, the Company contends that its proposal to exclude additional job classifications from contract coverage is a mandatory subject of bargaining. This proposal, item 1 of a 14-item list in the Company's section 6 notice of intended changes in the agreement *fn18" submitted to the TWU on July 28, 1978, provided:

1. Amend Article 1(c) to provide that the agreement shall not cover employees in positions . . . including the following:
(a) Sales Representatives
(b) Secretaries to the District Sales Managers
(c) Secretaries to the Commercial Managers
(d) Secretary to the Personnel Manager
(e) Secretary to the Accounting Manager
(f) Secretaries to the Cargo ...

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