L Ed 2d 565 (1993); G. Barnett, Machinery and Labor (1926).
Because of the unpredictable and short-term nature of much of the work in the construction industry, collective bargaining based on organizing after employees are hired is an incomplete means to protect the rights of employees. For this reason, exceptions to many otherwise applicable rules governing relationships among employers, trade unions and employees have been adopted by Congress. See 29 USC 158(e), (f). These rules permit pre-hire agreements requiring employers to obtain their workforce from among union members. See Building & Construction Trade Council v. Massachusetts Water Resources Authority, 113 S. Ct. 1190, 122 L. Ed. 2d 565 (1993); McNeff v. Todd, 461 U.S. 260, 75 L. Ed. 2d 830, 103 S. Ct. 1753 (1983); NLRB v. Local Union No. 103, 434 U.S. 335, 54 L. Ed. 2d 586, 98 S. Ct. 651 (1978). Such arrangements are vital to insuring to employees and their representatives the ability to bargain effectively in a volatile job environment, see Rottenberg, "Property in Work," 15 Ind'l & Labor Rel Rev 402 (1962). They have, indeed, replaced the raw conflict of earlier eras which often led to violence. See P. Zausner, Unvarnished (1941).
Pre-hire commitments to obtain workers from given sources, should they be deemed effectively non-cancellable and enforceable notwithstanding efforts by employers to extricate themselves from the arrangements at contractually defined times, would create self-perpetuating structures.
Such a situation would be adverse to the interests of both employers and employees, since a union would no longer need the support of employees within the collective bargaining unit to retain its position. The sole input from the workers whose interests are to be protected would then be through internal union political action on the part of members (not necessarily the entire workforce hired under union auspices), which Congress sought to protect in the Bill of Rights of Members of Labor Organizations, Title II of the Labor Management Reporting and Disclosure Act of 1959, Public Law 86-257, 73 Stat 522, 29 USC 411-415.
These safeguards standing alone provide an incomplete counterpart to the realistic opportunity to select one's collective bargaining representative (or no representative) under 29 USC 159. See Weyand, "Majority Rule in Collective Bargaining," 45 Colum L Rev 556 (1945). The chief additional safeguard against ossification in the industry is the necessity for a union to retain the support of workers in the industry so as to be able to induce employers to accept its collective bargaining demands and not to opt out of the pre-hire contract during the customary 30-day "open season" period available prior to expiration. Employers are encouraged not to opt out when they discern the necessity to deal with a particular union (a) to obtain good workers or indeed any workers at all, (b) to secure customers who wish to deal with union shops, and (c) to avoid strikes, picketing and similar organizing tactics.
Without an underpinning in employee-based economic power, a self-perpetuating contractual structure risks becoming divorced from its roots, with ill effects.
In order to maintain the stability important to job security and productivity, and at the same time to retain responsiveness to inevitable change in the performance of any entity including both unions and employers, collective bargaining contracts in the building and construction industry customarily - like the one involved here - prohibit employers from opting out except during a limited time window, but allow them to do so during that window.
Employer notice of withdrawal may trigger various activities: efforts to renegotiate a new agreement, unfair labor practice charges under 29 USC 158, a request for an election under 29 USC 159 if sufficient stability of the workforce exists to make this meaningful; or economic measures brought to bear on the employer.
Interpretation of the collective bargaining agreements according to their explicit and implicit terms can protect both employer and employee interests, and can promote the benefits of stability and openness to changing needs.
On March 11, 1993 the employer sent a letter to the District Council within the 30 day time window for avoiding automatic extension provided for in the agreement, advising that the Association, which had negotiated the most recent agreement between the employer and the District Council, would no longer bargain for the employer. Receipt of this letter by the District Council has not been contested, but it was not originally sent by registered or certified mail. A duplicate letter was thereafter sent by certified mail return receipt requested and received by plaintiff on March 26, 1993, also within the time window.
The District Council's response indicated that withdrawal from the Association did not constitute withdrawal from the collective bargaining agreement; on April 19, 1993 (after expiration of the time window), the employer explicitly repudiated any bargaining relationship with the District Council effective June 1, 1993.
The District Council argues that an agreement preceding the 1990 collective bargaining agreement negotiated by the Association remains in effect and has not been terminated. This, however, is unrealistic: continuation of two agreements, one of which (the current one) would evolve and change while an earlier one is still in effect would create significant risks of confusion in day-to-day contract administration if the provisions differed, as the District Council claims they do with regard to the time window to opt out. See Puretest Ice Cream v. Kraft, 806 F.2d 323, 325 (1st Cir. 1986); compare also New York State Constitution art III § 16 (barring cross-references to other state laws which may have been amended in most situations). Indeed, the District Council's interpretation would seem to prevent an employer in U.W. Marx's position from ever opting out: a notice valid under either agreement would be untimely under the other. A collective bargaining equivalent of a Rule Against perpetuities must be assumed to have been implicit in both contracts by virtue of each containing an opt-out period.
If an employer affirmatively and in compliance with the terms of a multi-employer agreement revokes authority for the association to proceed, this would appear sufficient action to be effective under Cedar Valley Corp. v. NLRB, 977 F.2d 1211, 1220 (8th Cir. 1992) provided that the union receives the revocation notice. See Trustees of UIU Health & Welfare Fund v. New York Flame Proofing Co., 828 F.2d 79 (2d Cir. 1987).
The District Council further argues that abandonment of multi-employer bargaining is not the same as cancelling the other terms of the collective bargaining agreement. The notice of termination of multi-employer bargaining, however, was sufficient to put the District Council on notice of intent to end the contract. International Brotherhood of Electrical Workers Local 532 v. Brink Construction, 825 F.2d 207 (9th Cir. 1987); see also Local 92 v. B&B Steel Erectors, 850 F.2d 1551 (11th Cir. 1988); William Chalson & Co v. Amalgamated Jewelry, Diamond & Watchcase Workers Union, 478 F. Supp. 1103 (SDNY 1979).
Continued compliance with provisions contained in an agreement after its expiration does not necessarily imply acquiescence in being bound, and is equally consistent with voluntary willingness to perform the particular acts involved. See ILGWU National Retirement Fund v. Levy Bros, 1987 U.S. Dist. LEXIS 7731, Dkt No 84 Civ 3673 (GLG), SDNY Aug 21, 1987.
Thus both contract language and national labor policy support a finding based on the undisputed facts that the employer validly disclaimed further adherence to any collective bargaining agreement effective June 1, 1993.
If, however, a party acts in a way causing confusion to another party, it cannot take advantage of the resulting situation. See Schrader v. Royal Caribbean Cruise Line, 952 F.2d 1008, 1013 (8th Cir. 1991); Gallagher v. Donald 803 F. Supp. 899, 901 (SDNY 1992). Should an employer fail notify a multi-employer bargaining association of its intent to withdraw from such an association, resulting in the Association sending to a union a list showing the employer on a roster of continuing members of the group, and this results in actual confusion, this may defeat the effectiveness of the employer's withdrawal. If this can be shown here, plaintiffs may move to reinstate their claims for post-May 1, 1993 contractual violations.
Where a collective bargaining agreement is violated, relief can still be had after its expiration. See, e.g., Sheet Metal Workers Local 57 Welfare Fund v. Tampa Sheet Metal, 786 F.2d 1459 (11th Cir. 1986).
Relief is available to recover any welfare fund payments due under ERISA for work done utilizing non-District Council hirees prior to expiration of the collective bargaining agreement. Reliability of payments counted upon by welfare funds based on expected receipts for work within the ambit of the text of applicable agreements is vital to the solvency of the funds and to the protection of their beneficiaries. See authorities cited, Schueler v. Roman Asphalt, 827 F. Supp. 247 (SDNY 1993). Where, as here, the unpaid sums are due to a multi-employer fund, a remedy is particular important so that the stability of such funds protecting a large number of beneficiaries can be maintained. See generally NLRB v. Local Union No. 103, 434 U.S. 335, 54 L. Ed. 2d 586, 98 S. Ct. 651 (1978).
In part for this reason, Trustee plaintiffs have been held entitled to such payments without regard to the existence or nonexistence of a jurisdictional dispute. Tapers v. Bernie Wolff Construction, 1991 U.S. Dist. LEXIS 16315, 120 Lab. Cas. (CCH) 11,089, 1991 WL 243428 (SDNY 1991) (JSM).
While the issue of whether or not any actual violations of contract provisions occurred is not considered in ruling upon the current motions, it is important to the discussion of relief which follows to recognize the importance of whether or not the current controversy involves a jurisdictional dispute.
Every pre-hire contract requiring hiring of union members contains an explicit or implicit definition of the work, and the geographic area covered. See 1990 collective bargaining agreement, Art IV, V, at 6, 17. Where work definitions or geographic delineations such as those in the 1990 collective bargaining agreement are contested by other unions, either by furnishing union workers to the employer or by other means, a jurisdictional dispute is created. The basic elements of a jurisdictional dispute are present if employees belonging to other unions performed the work the District Council asserts should have been given to its members, unless the use of those other employees was initiated by the employer unilaterally with the objective of reducing labor costs or for similar reasons.
The conduct of the parties is pertinent to evaluation of the status of a dispute as jurisdictional or solely contractual. Under the 1990 collective bargaining agreement, it is "specifically agreed that any controversy arising out of this Agreement involving the interpretation of its terms and conditions, shall be settled in accordance with the grievance procedure set forth in this Article." If voluntary resolution is unsuccessful, there is a provision for resolution through arbitration. Such clauses have been clearly enforceable under § 301 of the Taft-Hartley Act, 29 USC 185 since United Steelworkers v. American Mfg Co., 363 U.S. 564, 4 L. Ed. 2d 1403, 80 S. Ct. 1343 (1960); United Steelworkers v. Warrior & Gulf Nav Co., 363 U.S. 574, 4 L. Ed. 2d 1409, 80 S. Ct. 1347 (1960); United Steelworkers v. Enterprise Wheel & Car Co, 363 U.S. 593, 4 L. Ed. 2d 1424, 80 S. Ct. 1358 (1960) ("Steelworkers Trilogy").
The arbitration clause of the 1990 collective bargaining agreement would appear to be binding, and to bar invocation of judicial relief except to enforce or otherwise deal with an award pursuant to the grievance procedure, unless an exception to the broad scope of the clause is applicable. Exceptions are provided in the agreement for both hiring procedures and jurisdictional disputes, thus treating both as outside the normal ambit of the employer - union arbitration clause.
Disputes concerning interpretation of hiring provisions of the agreement would lend themselves to conflicts with other unions, and also to inter-union resolution with the assistance of the expertise of a labor arbitrator steeped in the traditions of the industry. Exclusion from the arbitration procedure of hiring and jurisdictional disputes reflects recognition that both have repercussions affecting third parties, and that they involve ramifications extending beyond the relationships between the employer and the District Council. While not conclusive, the structure of the arbitration clause thus lends weight to the possibility that the hiring aspect of the current lawsuit may be characterized as a jurisdictional dispute.
To avoid disruption of employee job stability or employers' ability to do business, jurisdictional disputes are customarily resolved by inter-union arbitration (see Drywall Tapers v. Local 530, 954 F.2d 69 (2d Cir. 1992)) or by the National Labor Relations Board and not through litigation by a particular contestant against an employer caught in the middle of such a dispute. Where, of course, it can be shown that an employer created such a dispute arbitrarily in order to find personnel willing to accept lesser compensation, these considerations are inapplicable. See generally 29 USC 160(k); Newspaper Printing Corp. v. NLRB, 692 F.2d 615 (6th Cir. 1982); Old Country Iron Works v. Iron Workers Locals 40, 842 F. Supp. 75, 78 (SDNY 1993)); Goldstein, "Electronic Journalism and Union Rivalry," 29 Labor LJ 137 (1978).
Where litigation with a single employer is initially involved, other jurisdictional disputants may be deemed necessary parties and which must be joined. See Fed.R.Civ.P. 19; Alfarone v. Bernie Wolff Construction, 788 F.2d 76 (2d Cir.), cert. denied 479 U.S. 915, 93 L. Ed. 2d 289, 107 S. Ct. 316 (1986). Thus prior to determination of what relief, if any, can be provided for a seeming violation of a hiring hall requirement, any other unions contesting for the work by referring employees for it should be joined or notified and given an opportunity to intervene. See authorities cited, Omar International v. ALAF, 817 F. Supp. 394, 399 (SDNY 1993).
While a union may sue for monies due its members, it must show that specific named persons are entitled to specific relief. See International Union v. Hoosier, 383 U.S. 696, 16 L. Ed. 2d 192, 86 S. Ct. 1107 (1966). It would be extremely difficult to reckon backwards after the fact and determine what union members who were not hired would have been available to have been hired by the employer.
A further obstacle may be presented if the District Council's objection to allegedly improper hiring decisions was deferred beyond the time of their discovery. Delay in claiming asserted damages during a period in which these damages accumulated might constitute laches barring recovery claimed at a later date. See generally Bourne Co v. Tower Records, 976 F.2d 99 (2d Cir. 1992); Daingerfield Island Protective Soc'y v. Lujan, 287 U.S. App. D.C. 101, 920 F.2d 32 (DC Cir. 19900 (R. Ginsburg, J.), cert. denied 112 S. Ct. 54, 116 L. Ed. 2d 31 (1991); In re New York Trap Rock Corp., 158 Bankr. 574 (SDNY 1993).
The District Council has not, in its submissions so far, claimed ignorance at the time of the use by the employer of workers now asserted to have been improperly hired. Retroactive imposition of double wage costs on employers without specific warning at the time of the events involved would not further the purpose of the national labor laws.
If a collective bargaining agreement was violated while in effect, nonmonetary prospective relief would be possible by means of injunctive order directed to the employer and all parents or affiliates under Fed.R.Civ.P. 65, should any of them be active in or re-enter the area.
Dated: White Plains, New York
May 3, 1994
VINCENT L. BRODERICK, U.S.D.J.