Interstate Electric Co.

National Labor Relations Board - Board Decisions

Jan 31, 1977

227 N.L.R.B. 1996 (N.L.R.B. 1977)

1996 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Interstate Electric Company and Penn H . Smith and
Intermountain Chapter , National Electrical Con-
tractors Association , Inc., Party to the Contract
International Brotherhood of Electrical Workers,
Local No. 354 and Penn H . Smith and Intermoun-
tain Chapter, National Electrical Contractors Asso-
ciation, Inc., Party to the Contract . Cases 27-CA-
4611 and 27-CB-960
January 31, 1977
DECISION AND ORDER
BY CHAIRMAN MURPHY AND MEMBERS
FANNING, JENKINS, AND WALTHER
On February 23, 1976, Administrative Law Judge
Bernard J. Seff issued the attached Decision in this
proceeding. Thereafter, General Counsel filed excep-
tions and a supporting brief. Respondent Internation-
al Brotherhood of Electrical Workers, Local No. 354,
hereinafter called Respondent Union, filed a brief in
answer to General Counsel's exceptions, and Build-
ing and Construction Trades Department, AFL-
CIO, filed a brief as amicus curiae. Respondent
Union's request for oral argument before the Board
was granted and, on July 29, 1976, the parties argued
the matter orally in Washington, D.C.' All of the
parties and the amicus curiae were afforded full
opportunity to participate in the argument.
The Board has considered the record and the
attached Decision in light of the exceptions, briefs,
and oral arguments and has decided to affirm the
rulings , findings, and conclusions of the Administra-
tive Law Judge, as modified below, and to adopt his
recommended Order.
The complaint alleged that Respondent Union and
Respondent Employer, Interstate Electric Company
(herein also called Interstate), unlawfully maintained
and enforced a contractual hiring hall provision
which gives priority, with respect tojob referrals and
layoffs, to persons "who have been employed for a
period of at least 2 years of the last 4 years under a
collective bargaining agreement between the parties
to this agreement." We agree with the Administrative
Law Judge's conclusion that the Respondents' con-
duct did not violate the Act.
The facts are not materially in dispute and are fully
set forth in the Administrative Law Judge's Decision.
Interstate is a member of Intermountain Chapter,
National Electrical Contractors Association, Inc.
(herein called NECA), an association of employers
engaged in the electrical industry which exists for the
purpose, inter aka, of negotiating collective-bargain-
ing agreements with Respondent Union. NECA and
Respondent Union have for many years negotiated
successive collective-bargaining agreements, the most
recent of which was effective January 1, 1974,
through December 31, 1975. These contracts cover
employees of NECA's members, including Interstate,
as well as employees of signatory employers. The
latter are employers in the electrical industry who,
while not members of NECA, have signed a letter of
assent or other commitment to be bound by the
agreement between NECA and Respondent Union.
Article III of the most recent contract between the
parties provides for the establishment and mainte-
nance of an exclusive hiring system under the
following relevant provisions:
Sec. 3 The Union shall select and refer appli-
cants for employment without discrimination
against such applicants by reason of membership
or nonmembership in the Union or race, creed or
color, and such selection and referral shall not be
affected in any way by rules, regulations, by-laws,
constitutional provisions or any other aspect or
obligation of Union membership policies or
requirements. All such selection and referral shall
be in accordance with the following procedure.
Sec. 4(a) The Union shall maintain a register of
applicants for employment established on the
basis of the groups listed below. Each applicant
for employment shall be registered in the highest
priority group for which he qualifies.
Group I-All applicants for employment who
have 4 or more years experience in the trade, are
residents of the geographical area constituting the
normal construction labor market, have passed a
journeyman's examination given by the duly
constituted Local Union of the IBEW and who
have been employed for a period of at least 2 years
of the last 4 years under a collective-bargaining
agreement between the parties to this agreement.
Group II-All applicants for employment who
have 4 or more years of experience in the trade
and who have passed the journeyman's examina-
tion given by the duly constituted Local Union of
the IBEW.
Group 111-All applicants for employment who
have 2 or more years' experience in the trade, are
residents of the geographical area constituting the
normal construction labor market and who have
been employed for at least 1 year in the last 3
years in the trade under a collective-bargaining
agreement between the parties to this agreement.
I Argument was also heard in Local Union No 68, International Brother-
hood of Electrical Workers (Howard Electric Company), 227 NLRB 1904, a
case involving closely related issues , issued this day
227 NLRB No. 291
INTERSTATE ELECTRIC CO. 1997
Group IV-All applicants for employment who
have worked at the trade for more than 1 year.
(b) When making reductions in the number of
employees due to lack of work, Employers shall
use the following procedure:
(A) Temporary employees, if any are employed,
shall be laid off. Then employees in Group IV
shall be laid off next, if any are employed in this
group. Next to be laid off are employees in Group
III, if any are employed in this Group; then those
in Group II, and those in Group I.
(B) Paragraph (A) will not apply as long as the
special skill requirement as provided for in Article
III, section 6, subsection 1 is required. In order for
an applicant to be an employee under this
agreement, he shall possess and maintain such
electrical license as are applicable and legally
required.
One employer will not subcontract work to
another employer for the purpose of avoiding this
referral procedure.
Employees Penn H. Smith, the Charging Party, and
Gordon B. Wood are members of IBEW Local Union
357 in Las Vegas. Smith was referred by Respondent
Union to Interstate's job in St. George, Utah, on June
26, 1974. Wood was referred by Respondent Union to
Interstate's job in North Salt Lake City on June 7,
1974, and was subsequently transferred by Interstate
to the St. George job without further involvement by
Respondent Union. Both men were terminated on
June 20, 1975, in a reduction in force necessitated by
the near completion of the job. It is undisputed that
they were selected for termination in accordance with
the contract provision which requires that, in the
event of a layoff, electricians referred under group II,
above, be laid off ahead of those in group I. It is also
undisputed that Smith and Wood failed to qualify for
group I only because they had not worked "for a
period of at least 2 years of the last 4 years under a
collective bargaining agreement between the parties
to this agreement" as required for such status. Thus
although Smith and Wood had more seniority on the
job than four other journeyman electricians, they
were laid off ahead of these four who met the so-
called "2 in 4" requirement for group I status.2
Following their terminations, both Smith and
Wood signed the out-of-work book at Respondent
Union's office and both were offered referrals to
other jobs. They declined such offers because the jobs
were not located in the St. George area. On August
11, 1975, both Smith and Wood received letters from
Respondent Union advising them of a need for
journeyman wiremen and stating that "[i]f you are
still interested and plan to remain in our jurisdiction,
please drop by the union office and register as
required in order to obtain a job referral ." No reply
was received from either man.
It is clear from the foregoing, and the Administra-
tive Law Judge found, that Respondent Union did
not overtly discriminate against either Smith or
Wood because of their lack of membership in
Respondent Union . To the contrary, it referred them
to the Interstate job and when that was completed it
offered to refer them to other available jobs. To that
extent , therefore, the Administrative Law Judge
correctly distinguished this case from Nassau-Suffolk
Chapter of the National Electrical Contractors ' Associ-
ation, Inc. (Alcap Electrical Corporation), 215 NLRB
894 (1974). It is also clear that article III of Respon-
dents ' contract does not on its face discriminate
between applicants for referral on the basis of their
membership or nonmembership in Respondent
Union . Indeed , section 3 of article III expressly
mandates against such discrimination. The issue,
therefore, is whether the "2 in 4" years experience
requirement for group I referral priority is implicitly
discriminatory because , as General Counsel con-
tends, it rewards applicants who have worked 2 of the
last 4 years for employers signatory to the contract
and who , by virtue of the contract 's union-security
provision , therefore , are members of Respondent
Union . Conversely, General Counsel argues that this
provision penalizes employees or applicants for
referral with greater experience in the trade solely
because they have exercised their Section 7 rights by
having worked for nonunion employers or employers
not signatory to Respondent Union's contract. We
disagree with these contentions and find, instead, that
the disputed contract provision is permissible under
Section 8(f)(4) of the Act.
Section 8(f) of the Act provides , in relevant part, as
follows:
(f) It shall not be an unfair labor practice under
subsections (a) and (b) of this section for an
employer engaged primarily in the building and
construction industry to make an agreement
covering employees engaged . . . in the building
and construction industry with a labor organiza-
tion of which building and construction employ-
ees are members . . . because . . . (3) such
agreement requires the employer to notify such
labor organization of opportunities for employ-
ment with such employer, or gives such labor
organization an opportunity to refer qualified
applicants for such employment, or (4) such
agreement specifies minimum training or experi-
2 These four remaining electricians were terminated between September
and November 1975, when thejob was completed
1998 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ence qualifications for employment or provides
for priority in opportunities for employment
based upon length of service with such employer, in
the industry or in the particular geographical area
.... [Emphasis supplied.]
As is clear from the above, Section 8(f)(4) expressly
exempts from the strictures of Section 8(a)(1) and (3)
and 8(b)(1)(A) and (2) of the Act and makes lawful an
exclusive referral system under which priority in job
referrals may be "based upon length of service with
such employer." General Counsel and our dissenting
colleague would have us construe the phrase "such
employer" as a term of art limited to the particular
employer or multiemployer association (i.e., Inter-
state of NECA) whose employees the Respondent
Union represents in an appropriate unit. We believe
that such a narrow construction of the phrase would
be unrealistic in the construction industry and
contrary to the purposes for which Section 8(f) was
designed. There is nothing in the legislative history of
that section to suggest that the term "employer" was
used as a term of art to define the specific employer
whose employees the union represents in an appropri-
ate unit. Indeed, as stated in the Report of the House
of Respresentatives Committee on Education and
Labor:
In the building and construction industry it is
customary for employers to enter into collective-
bargaining agreements for periods of time running
into the future, perhaps 1 year or in many
instances as much as 3 years. Since the vast
majority of building projects are of relatively short
duration, such labor agreements sometimes apply
to jobs which have not been started. The practice
of signing such agreements for future employment
is not entirely consistent with Wagner Act rulings
of the NLRB that exclusive bargaining contracts
can lawfully be concluded only if the union makes
its agreement after a representative number of
employees have been hired. One reason for this
practice is that it is necessary for the employer to
know his labor costs before making the estimate
upon which his bid will be based. A second reason
is that the employer must be able to have available
a supply of skilled craftsmen ready for quick
referral. The committee has decided that the
object of validating the prehire agreement in the
building and construction industry is sound and
has chosen to accomplish this object by providing
that a prehire agreement in that industry shall not
constitute an unfair labor practice under the act.3
3 H Rept 741, 86th Cong, 1st Sess, I Leg Hist 759 ,777-778 ( 1959) See
also S Rept 187 on S 1555, 1 Leg Hist 397 , 424-425 (1959)
The bill contains other provisions which take
into account the occasional nature of employment
in the building and construction industry. It does
so by reducing from 30 days to 7 the grace period
before which the employees may be required to
join the union. The reduction in this time allow-
ance reflects the normally short employment
period for construction employees. Also, the bill
contains provisions permitting an exclusive refer-
ral system or hiring hall based upon objective
criteria for referral. Thus it is permissible to give
preference based upon seniority, residence, or
training ... .
In a similar vem, the Senate Report on S.1555,
explaining Section 8(f), states:
This bill . . . contains other provisions which
take into account the occasional nature of em-
ployment in the building and construction em-
ployee [sic] . . . . Also similar to last year's bill
are provisions permitting an exclusive referral
system or hiring hall based upon objective criteria
for referral. Such criteria as are spelled out in the
bill are not intended to be a definitive list but to
suggest objective criteria which shall be applied
without discrimination. Thus it is permissible to
give preference based upon seniority, residence, or
training of the sort provided by the apprenticeship
programs sponsored by the Department of La-
bor.4
In light of the special allowances which Section 8(f)
makes for the employers and labor organizations in
the building and construction industry a limited
reading of the term "employer" in Section 8(f)(4)
would be unwarranted . Rather , we believe that it is
more consistent with the purposes of that section to
interpret the word "employer" as including any
employer who , although not a member of the
multiemployer association with which the union
negotiated the collective -bargaining agreement, has
agreed to be bound by such agreement while per-
forming work in that union 's area of geographical
jurisdiction . Therefore , we find that the term "em-
ployer" as used in Section 8 (f)(4) includes the
signatory employers here who executed letters of
assent to be bound by Respondent Union's contract
with NECA.
To the extent that our findings here are inconsistent
with those in Nassau-Suffolk, supra, that case is
hereby overruled.
Having found that Respondents did not violate
Section 8(a)(1) and (3) and 8(b)(1)(A) and (2) of the
4 S. Rept 187 on S . 1555,1 Leg Hist . 397, 424 425 (1959)
INTERSTATE ELECTRIC CO.
Act by maintaining and enforcing the hiring hall
provisions described above, we shall dismiss the
complaint in its entirety.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board adopts as its Order the recommend-
ed Order of the Administrative Law Judge and
hereby orders that the complaint be, and it hereby is,
dismissed in its entirety.
MEMBER JENKINS, dissenting:
Contrary to longstanding precedent, the majority
finds lawful a collective-bargaining agreement pro-
viding for an exclusive hiring hall arrangement which
by its very terms discriminates by giving preference to
applicants for employment on the basis of prior
employment under the collective-bargaining agree-
ment. It is well established that similar hiring hall
agreements which accord priority to applicants on the
basis of past experience with employers signatory to
the union contract are unlawful in that they penalize
employees for having exercised their statutory right to
refrain from bargaining collectively through the
union in the past, while rewarding those employees
who have chosen to work for employers who are
signatory to the union contract. It is clear that such
agreements infringe on an employee's rights guaran-
teed by Section 7 of the Act to refrain from union
activities.5
In the instant case, it appears that employment
under a union contract constitutes a condition to
preferred referral and layoff status (group I), and the
employee cannot obtain experience with an employer
who has a contract with the Union unless the Union
refers the employee. By approving the foregoing
arrangement, the majority states that a union which
controls hiring can stipulate that its referral prefer-
ence is dependent on employment under union
contracts. Such an arrangement clearly encourages
union membership, and is unlawful .6
The majority contends that Section 8(f)(4) expressly
exempts from the strictures of Section 8(a)(1) and (3)
and 8(b(l)(A) and (2) of the Act and makes lawful an
exclusive referral system under which priority in job
referrals may be "based on length of service with such
employer." The majority expands the term "employ-
er" as used in Section 8(f)(4) to include the signatory
s International Photographers of the Motion Picture Industries, Local 659 of
the International Alliance of Theatrical Stage Employees and Moving Picture
Machine Operators of the United States and Canada (MPO-TVof California
Inc., Y-A Productions, Inc), 197 NLRB 1187 (1972), Directors Guild of
America, Inc. (Association of Motion Picture & Television Producers, Inc)' 198
NLRB 707 (1972), Nassau-Suffolk Chapter of the National Electrical Contrac-
1999
employers here who executed letters of assent to be
bound by Respondent Union 's contract with NECA.
An examination of the legislative history of Section
8(f) leads me to the conclusion that the discriminato-
ry hiring hall provisions in the instant case were not
intended to be exempted from the strictures of the
Act. Both the House and Senate Reports cited by the
majority state that the bill permits "an exclusive
referral system or hiring hall based upon objective
criteria for referral" (emphasis supplied). The reports
note such criteria as seniority , residence , or training. I
cannot conceive how the requirement that an appli-
cant for employment must have worked for a period
of time under the union contract , rather than for a
nonunion employer , may be construed as "objec-
tive ." Furthermore , the contract provisions herein do
not relate to an "employer" but rather to signatories
of the contract . If this hiring hall arrangement is
found valid , a long-term employee of an employer
who had only recently joined NECA or signed the
contract would not be eligible for group I status
simply because he did not work the requisite time
under the union contract . In my view, Section 8(f)
was not intended to permit such practices.
The majority 's expansion of the term "such employ-
er" to encompass signatory employers who executed
letters of assent to be bound by the contract is
inconsistent with well-established law. The appropri-
ate bargaining unit does not include unknown
employers who might later choose to sign a letter of
assent agreeing to be bound by the multiemployer
contract . The provisions in question grant priorities
in opportunities for employment based not "upon
length of service with such employer ," but on service
under collective -bargaining agreement between the
parties to this referral procedure. It therefore grants
preference to employees and applicants because they
had been represented by the Union . I find no
sanction in Section 8(f)(4) for this discriminatory
conduct.
Nor does the majority's attempt to distinguish
Nassau-Suffolk, on the theory that Respondent Union
did not overtly discriminate against Smith or Wood
because of their lack of membership in Respondent
Union , withstand scrutiny . Indeed , Smith and Wood
were chosen for layoff because they had not worked
under the union contract for the required time.
Furthermore , I do not see what relevance the fact that
Smith and Wood turned down subsequent offers of
employment in other parts of the State has to do with
tors' Association, Inc (Alcap Electrical Corporation ), 215 NLRB 894 (1974),
Local Union No 77 ofInternational Brotherhood of Painters and Allied Trades,
AFL-CIO (Colorite, Inc), 222 NLRB 607 (1976)
6 The Radio Officers ' Union of the Commercial Telegraphers Union, AFL
[A H Bull Steamship Company] v. N L R.B , 347 U.S 17 (1954).
2000 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
the legality of their layoffs and the contractual
provision upon which their layoffs were based.
Accordingly, I would find that the Respondent
Employer violated Section 8(a)(1) and (3) of the Act,
and the Respondent Union violated Section
8(b)(1)(A) and (2).
DECISION
STATEMENT OF THE CASE
BERNARD J . SEFF , Administrative Law Judge: This case
came on for hearing before me at Salt Lake City, Utah, on
January, 4, 1976. The original charge was filed on August 6,
1975, and complaint was issued on September 10, 1975. An
order consolidating cases was issued on September 16,
1975. The complaint alleges that the Interstate Electric
Company is a member of the National Electrical Contrac-
tors Association (herein called NECA), and that Interstate
and International Brotherhood of Electrical Workers,
Local 354, are joint Respondents. In substance, the
consolidated complaint alleges Interstate, NECA, and
Local 354 have a contract whose provisions require the
employer-parties to the agreement to hire employees
exclusively through the union employment office in accord-
ance with referral procedures which give preference in
employment to applicants who have previously worked
under the Union's contract, and that thereby Respondent
Interstate is engaged in unfair labor practices within the
meaning of Section 8(a)(1) and (3) of the Act. It is further
alleged that Respondent Union is engaged in unfair labor
practices within the meaning of Section 8(b)(I)(A) and (2)
of the Act, by having invoked those provisions of the
contract which operate to separate employees from their
jobs and create a layoff order, depending upon which
classification they occupy as established in the contract.
The Respondents filed answers which denied the substance
of allegations in the complaint and the commission of any
unfair labor practices.
Upon the entire record, including my observation of the
witnesses and their demeanor, and after due consideration
of the briefs filed by the parties, I make the following:
FINDINGS OF FACT
1. COMMERCE
Interstate Electric Company, a Utah corporation which
maintains its principal office and place of business at 100
West Center, North Salt Lake City, Utah, is engaged in the
installation of electrical fixtures. It annually purchases and
receives goods and materials valued in excess of $50,000
directly from points and places outside the State of Utah.
Intermountain Chapter, National Electrical Contractors
Association, Inc. (NECA), is now and at all times material
herein has been an association of employers in the electrical
industry, including in its membership, among others,
Interstate Electric Company, the Employer, which exists
and functions for the purpose, among others, of represent-
ing its members in collective bargaining with Respondent
Local No. 354, International Brotherhood of Electrical
Workers.
All employers or firms who have signed a letter of assent
or other designation or commitment to be bound by the
collective-bargaining agreement in effect between Local
354 and NECA, described hereinafter and as jointly called
the signatory employers, are employers in the electrical
industry operating within the geographical area of Respon-
dent Local 354s jurisdiction.
Annually, the combined employer-members of NECA in
the course and conduct of their business operations
purchase, and cause to be delivered to their respective
places of business within the State of Utah, goods and
materials valued collectively in excess of $50,000, said
goods and materials being received directly from States
other than the State of Utah.
Annually, the combined employer-members of the Asso-
ciation, in the course and conduct of their business
operations, collectively perform services outside the State of
Utah valued in excess of $50,000. On the foregoing
admitted facts, I find that NECA and its employer-mem-
bers are engaged in commerce and in operations affecting
commerce within the meaning of Section 2(6) and (7) of the
Act.
H. THE LABOR ORGANIZATION INVOLVED
It is admitted , and I also find , that Respondent Union is a
labor organization within the meaning of Section 2 (5) of the
Act.
III. THE ALLEGED UNFAIR LABOR PRACTICES
A. Background Events
Respondent Union and Respondent Interstate have had
bargaining relationships for at least 17 years. The most
recent labor agreement was effective January 1, 1974,
through December 31, 1975. Section 4(a) provides:
The Union shall maintain a register of applicants for
employment established on the basis of the groups listed
below. Each applicant for employment shall be regis-
tered in the highest priority group for which he qualifies.
Group I-All applicants for employment who have 4
or more years experience in the trade, are residents of
the geographical area constituting the normal construc-
tion labor market, have passed a journeyman's exami-
nation given by the duly constituted Local Union of the
IBEW and who have been employed for a period of at
least 2 years of the last 4 years under collective-
bargaining agreement between the parties to this
agreement.
Group II-All applicants for employment who have
4 or more years of experience in the trade and who have
passed the journeyman 's examination given by the duly
constituted Local Union of the IBEW.
Group III-All applicants for employment who have
2 or more years' experience in the trade, are residents of
the geographical area constituting the normal construc-
tion labor market and who have been employed for at
least 1 year in the last 3 years in the trade under a
collective-bargaining agreement between the parties to
this agreement.
INTERSTATE ELECTRIC CO. 2001
Group IV-All applicants for employment who have
worked at the trade for more than 1 year.
(b) When making reductions in the number of
employees due to lack of work, Employers shall use the
following procedure:
(A) Temporary employees, if any are employed, shall
be laid off. Then employees in Group IV shall be laid
off next, if any are employed in this group. Next to be
laid off are employees in Group III, if any are employed
in this Group; then those in Group II, and those in
Group I.
(B) Paragraph (A) will not apply as long as the
special skill requirement as provided for in Article III,
section 6, subsection 1 is required. In order for an
applicant to be an employee under this agreement, he
shall possess and maintain such electrical license as are
applicable and legally required.
One employer will not subcontract work to another
employer for the purpose of avoiding this referral
procedure.
B. The Alleged Discriminatory Layoffs of Smith
and Wood
Initially, it should be noted that there is no dispute as to
the facts. Both Smith and Wood are members of the Las
Vegas Local Union 357, IBEW. They applied for work
through Respondent Union and were referred to the
Interstate job at St. George, Utah, on June 26, 1974. Both
Smith and Wood were terminated on June 20, 1975. The
evidence is uncontroverted that the job was in its final
stages and that Smith and Wood were terminated on the
same day. Interstate Manager Sproul made the decision to
reduce the payroll by two employees. No umon officer or
agent participated in the decision to reduce the work force
at the St. George job.
William L. Walker, Interstate general superintendent,
stated that Smith and Wood were laid off because they were
in group II and the layoff procedure was in strict accord-
ance with the agreement. There were six electricians,
including the foreman, working on the job; four of whom
were in group I, and the other two, Smith and Wood, had
group II status. Walker stated that he was aware that Smith
and Wood were in group II because their referral cards
were so marked. The St. George job closed down in
November 1975. After the layoff, there was a gradual
reduction of the remaining three electricians and a foreman
which occurred between September and November 1975.
After the layoff, no other employees were referred to the
jobs by the Union. The Company sent one of its own shop
employees to the job as cleanup man. This employee was
not referred by the Union. Except for the St. George job,
Interstate has had no jobs within 150 miles of St. George,
Utah, during the past 5 years. Wood was moved to the St.
George job by Interstate from its Husky Oil job in North
Salt Lake City, without a umon referral. Wood was a
member of Las Vegas Local 357 and a resident of St.
George, Utah.
Anderson stated that there was a negligible amount of
union electrical work in the St. George area. St. George is
300 miles from Salt Lake and carries a $22-per-day
subsistence rate. Since both Smith and Wood lived near St.
George, the $22 per diem was particularly attractive to
them, as a referral out of Salt Lake would carry a high
subsistence while living at home. Smith and Wood com-
muted between St. George, Utah, and Las Vegas, Nevada,
for employment over 100 miles away.
Anderson made the hiring hall records available, showing
referrals during November 1, 1974, and also November 1,
1975, as follows: A total of 1,158 referrals; 649 from group I
book; 480 from group II book; 15 from group III book; and
14 from group IV book. Umon Exhibit 5 identified Local
354 members who had not attained group I status, namely:
six local members had book IV status; eight had book III;
and five had book II status.
Union Exhibit 6 lists applicants not members of Local
354 who had book I status under the referral procedure
during the year from November 1, 1974, through November
1, 1975. This exhibit was substantially expanded to 39
separate exhibits marked "6(a)" through "6(mm)" and
identifies nonmembers of Local 354 holding group I status.
Anderson explained that Local 354 members who leave
the Union's jurisdiction to work elsewhere forfeit group I
standing. According to Anderson, membership or non-
membership in or representation or nonrepresentation by
Local 354 is not a condition of referral. There was no
refutation of this evidence. Nonunion members are accept-
ed under the above-described referral practices. Total
union membership is about 750, with replenishment
through an active apprenticeship program of 70 men.
Charging Party Penn Smith had not made application to
become a member of Local 354. He had no problem
obtaining a job through the referral hall. Smith was sent to
Dugway, a job in Utah, and then to the St. George job on
June 26, 1974. The Union contends that Smith was fairly
treated by Union Business Agent Kilpatrick. The Umon
points out that Kilpatrick loaned Smith $40 in order for
Smith to obtain his state license. Smith received coopera-
tion and fair treatment from the Union.
Following the layoff in June 1975, by Interstate, both
Smith and Wood came into the union office and again
signed the out-of-work book. Smith and Wood were offered
jobs at Price, Utah, about 125 miles from Salt Lake, which
they both declined to accept. They also were offered jobs at
Provo, Utah, about 50 miles from Salt Lake. These jobs
were declined. They were only interested in the job in the
St. George area where they lived. After the initial signup in
July 1975, neither Smith nor Wood again signed the out-of-
work book as required by the referral procedure.
Both Smith and Wood received union letters on August
11, 1975, explaining that "at the present time we are in need
of several journeymen wiremen. If you are still interested
and plan to remain in our jurisdiction, please drop by the
umon office and register as required in order to obtain a job
referral." No reply was received from either of these men.
Neither Smith nor Wood manifested an interest in
securing whatever work was made available to them by way
of union referrals. The testimony in the record demon-
strates this fact. Smith testified as follows:
2002 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Q. If there were any other work available through
Local 354 but not in the St. George area, would you
have accepted it?
A. Distance would be a factor whether I accepted it
or not, how far-if it was within 150 miles of St. George,
I would accept the employment.
There was little union work within 150 miles of St. George.
Smith would not have accepted a job in Salt Lake City,
Utah, if it had been offered, nor would he have moved away
from his home to take a Salt Lake job. Wood's attitude was
the same. He turned down a job for Jelco at Price, Utah,
and refused a job unless it was within 150 miles from St.
George. The record also shows that Wood had a small farm
which required his attention. In the 3-1/2 years Wood lived
near St. George, he had never previously applied for ajob
through the Salt Lake IBEW Local 354.
The decision to reduce the work force on the job was one
that was made entirely by management. After June 20,
1975, no one was added to the job. No one on behalf of the
Union requested the layoff of Smith or Wood according to
the general superintendent, William L. Walker, of Inter-
state. Within the last 5 years Interstate had not had an
electrical job, except the St. George job, within 150 miles of
St. George. Walker told the Board investigator that "it is
not a requirement that a man be a member of the Salt Lake
City Local to be in class L" The successor to Kilpatrick as
business agent, Lynn Bird, testified that he offered to put
Smith and Wood on jobs at Brigham Young University,
Provo, Utah, after they signed the out-of-work book on July
1, 1975. Both men turned him down when they learned
there was no subsistence pay for Provo.
C. Discussion
Respondent Union's brief contends that:
General Counsel asserts that priority in employment in
this case was granted to applicants not on the basis of
length of service with an employer, but rather, on the
basis of prior employment at which applicant was
represented by the Union. Thus, he argues, the referral
provisions violate the Act, and consequently, the layoffs
of Smith and Wood also violate the Act.
The difficulty with his position is that both Smith and
Wood had equal access to referrals from the Union's
hiring hall, and that the system was operated fairly and
without discrimination generally or as concernei either
Smith or Wood.
s * * +
... The U.S. Supreme Court in Teamsters Local 357
v. N. L. R. B., 365 U.S. 667. The Court there stated, at 365
U.S. 673:
Congress has not outlawed the hiring hall,
though it has outlawed the closed shop except
within the limits prescribed within the provisos to
Section 8(a)(3). Senator Taft made clear his views
that hiring halls are useful, that they are not illegal
per se, that unions should be able to operate them
so long as they are not used to create a closed
shop.
The Supreme Court ruled in Local 357 that the Act
only prohibits discrimination in the operation of refer-
ral systems which encourage or discourage union
membership.
Also note the Board 's own decision in Operating
Engineers Local 965 (J-M Co., Inc.), 173 NLRB 1461.
The complaint in that case alleged that the refusal by
the employer , at the instigation of the Union , to recall
or reinstate certain employees because they were not
members of the Union constituted violations of Section
8(a)(1) and (3) by the Company and 8(b)(1)(A) and (2)
by the Union . The collective-bargaining agreement
there provided for priority referral of registrants who
had 2 years' residence in the area, based on the amount of
work experience they had with contractors who had signed
agreements with the Union . Those who had no seniority
with contractors and agreement with the Union would
be placed at the bottom of the referral lists in the order
in which they reported being out of work. The referral
system based on graduated experience with contractors
in signed agreement with the Union , is identical in
principle to the IBEW referral plan here in issue. The
Trial Examiner in Operating Engineers found no viola-
tion of the Act and the Board affirmed . In his opinion,
adopted by the Board , he stated as follows:
I have found that the referral service does
discriminate in favor of area residents with work
experience with contractors bound by the Con-
tract , but that such discrimination is legal.. .
[T]he preference they receive in connection with
referrals, on this record , is due to the seniority
based on area residence and work experience and
not to union membership . As stated, such a
preference is not illegal.
Respondent Union takes the position that while the IBEW
referral system gives preference in the higher classifications
to those who have experience under the collective -bargain-
ing agreement, it does not base such preference on union
membership , which is all that the Supreme Court has stated
is prohibited . As the Court stated in Local 357 at 674-675:
"The lanugage of § 8(a)(3) is not ambiguous. The
unfair labor practice is for an employer to encourage or
discourage membership by means of discrimination.
Thus this section does not outlaw all encouragement or
discouragement of membership in labor organizations;
only such as is accomplished by discrimination is
prohibited . Nor does this section outlaw discrimination
in employment as such , only such discrimination as
encourages or discourages membership in a labor
organization is proscribed."
The Union's brief also calls attention to Bechtel Power
Corporation, 223 NLRB 925 (1976). In that case, the
violation occurred because the hiring hall was operating in
a manner that union members who were referred from the
hall could bump or retain job retention rates with tempo-
INTERSTATE ELECTRIC CO. 2003
rary nonunion employees who were hired at the gate. In the
instant case , Respondent Umo,i had on its referral lists
nonunion electricians who could secure referral from the
hall. Union Exhibit 6(x) lists William H. Murray, a group
III applicant, whose referrals dated back to August 8, 1974,
notwithstanding that he is not a member of the Local
Union or any IBEW local union.
The General Counsel places his principal reliance on the
case of Nassau-Suffolk Chapter of the National Electrical
Contractors' Association, Inc. (Aleap Electrical Corporation),
215 NLRB 894 (1974). In that case the Board found that a
collective -bargaining agreement , containing language virtu-
ally identical to that contained in the contract between the
Respondents herein, did grant preference in employment
opportunities to applicants who had worked as electricians
for employers who had collective-bargaining agreements
with the union, and did diminish the employment opportu-
nities and discriminate against applicants with equal or
even greater competence and experience merely because
the latter had not worked for an employer who was under
contract with the union. As found in Nassau, such discrimi-
nation has a natural tendency to encourage membership in
the union, and thereby violates the Act.
At first blush, it would appear that there are striking
similarities between Nassau -Suffolk and the case at bar.
However, there are some significant differences between
the cases which distinguish the two situations. In Nassau-
Suffolk, one Ernesto Flores, a Puerto Rican and a member
of a minority ethnic group, was denied an opportunity to
take the union's journeyman's examination. Flores, who
was not a member of respondent union, wrote letters on a
number of occasions requesting permission to take its
journeyman's examination , the passing of which was
necessary for his reclassification to the highest priority
referral group under the contract, but he had never received
any response. Furthermore, when Flores asked Union
Employment Manager Segall why he had received no
response to his request to the union's executive board to
take the journeyman's examination, he was told that he had
brought the union up on charges with the Human Rights
Commission and the union board did not take this lightly.
T} Board agreed with the General Counsel that Union
Manager Segall's statement to Flores reveals that the
union's real reason for repeatedly denying Flores an
opportunity to take the journeyman's examination was
because Flores had previously filed charges against the
union before the Human Rights Commission. The Board
concluded its decision as follows at 894:
In these circumstances, we find that the Unio; o actions
violated Section 8(b)(1)(A) and (2) of the Act by
restraining and coercing Flores it the exercise of his
rights under Section 7 of the Act, and by denying Flores
greater employment opportunities under its exclusive
referral system since Flores would have been placed in a
higher and more preferred referral category if he had
been permitted to take and pass the Union's journey-
man's examination.
In Nassau-Suffolk, therefore , the union was clearly guilty of
discrimination against Flores by the way it applied the
hiring hall provisions of its contract.
In the case at bar , Penn Smith was a member of a sister
local of the IBEW, Local 357, and had passed his
journeyman's examination . Furthermore , he was not de-
nied referrals to jobs by the Union. In fact, his employment
with Interstate Electric Company had been secured as a
result of the referral to this job by that Respondent.
In accordance with the contract, he had been properly
placed in group II by the Union. The contract provides that
when making reductions in the number of employees due to
lack of work the employer shall use the following proce-
dure:
(A) Temporary employees, if any are employed , shall be
laid off first . Then employees in Group IV shall be
laid off next , if any are employed in this Group.
Next to be laid off are employees in Group III, if
any are employed in this group ; then those in
Group II and then those in Group I.
Significantly, it should be noted that not only was Smith
laid off in accordance with the terms of the collective-
bargaining agreement but the layoff was effectuated by the
action of the Employer and not by anything the Respon-
dent Union did or failed to do.
The record amply supports the contention of the Employ-
er that the reason for the layoff had nothing whatever to do
with the Union . It was occasioned by the fact that the work
on the job being performed by Smith was winding down,
and the job was about to be completed . No other employees
were taken on after Smith and Wood were laid off. In fact,
the roster of men doing this same work as Smith dwindled
as the need for such employees diminished.
It also should be emphasized at this point that both Smith
and Wood were offered a number of referrals after their
separation from the Interstate payroll in the form of
referrals by the Respondent Union but they declined to
take any of these employment opportunities.
The principles of the Nassau -Suffolk case were correctly
stated by the General Counsel, but the case is easily
distinguishable because it i6 totally different on its facts
from the instant case.
In a recent case, Local Union 8, International Brotherhood
of Electrical Workers (Romanoff Electrical Corp.), 221
NLRB 1131 (1975 ), Romanoff was a member of the Toledo
Electrical Contractors Association and had collective-bar-
gaining agreements with Local 8 for many years. These
agreements contained union -security provisions and exclu-
sive hiring hall provisions which set forth four classifica-
tions of employees in descending order of priority for
referral to jobs. The operative distinction there was that
group I included journeyman residents in the Toledo area
while group II included nonresident journeymen . Appli-
cants for employment had to be selected and referred
without discrimination by reason of membership or non-
membership in the union. In that case the issue turned on
awarding scheduled overtime for which preference was
given to members of group I who were described as area
residents . The parties stipulated that unscheduled overtime
was not offered to applicants from groups other than group
I until the list of group I applicants had been exhausted.
As found by the Administrative Law Judge , absent a
finding of pretext or sham , preferential hiring or job
2004 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
retention based on an objective criterion, particularly in the
construction industry, would not be violative of the Act.
Therefore, the preferential assignment of unscheduled
overtime should not constitute an unfair labor practice
where it is based on the objective criterion of area
residence. The Board has long held that a union is not
prohibited from trying to ease the impact of local unem-
ployment by attempting to cause employers to limit work
opportunities to strictly local applicants. In other words,
the issue was not whether certain employees were accorded
unlawful preferential treatment because they were union
members, but whether the preferential treatment which
local residents received was in violation of the Act. The
Board continued by stating that travelers were less depend-
able than area workers and that local experience had
indicated that job completion schedules were usually met
with area men and not travelers. Consequently, they
accorded preferential treatment in the assignment of
unscheduled overtime to employees residing in the area.
Such discrimination is commonly not per se unlawful nor
does the nexus seem so suspicious as to require the Board to
substitute its wisdom for that of the parties. In summary,
the record did not indicate that the respondents had an
unlawful purpose in their policy of according preferential
assignment of unscheduled overtime to area residents. In
making this evaluation, the Board found that respondents
had a legitimate interest in favoring residents of the area
and further found that the General Counsel did not sustain
his burden of proving that respondents acted unlawfully in
fulfilling such interests. As the result of the above reason-
ing, the Board dismissed the complaint in its entirety.
Conclusion
It is clear that the decision in Nassau-Suffolk, heavily
relied on by the General Counsel, is not apposite to the
matter at bar because the facts are easily distinguishable. In
the instant case, the order of layoff followed by Respondent
Interstate is in direct conformance to the requirements of
layoff as set forth in the contract between the parties.
Furthermore , it is significant that the layoff was the
decision solely of the Employer , based on sound economic
reasons , and the Respondent Union played no part in this
decision. The absence of any discrimination directed
against Smith and Wood is evidenced by the fact that both
men were referred to their jobs by the Union . To further
buttress the point that the Union did not discriminate
against Smith and Wood, it is significant to note that they
were subsequently again referred to a number of other jobs
by the Union after the layoff by Interstate.
I find that Respondents Interstate and Local 354 did not
violate any provisions of the Act, and I recommend that the
complaint be dismissed in its entirety.
CONCLUSIONS OF LAW
It has not been established that Respondents committed
any of the unfair labor practices alleged in the complaint.
Upon the basis of the foregoing findings of fact and
conclusions of law, and upon the entire record in this case,
and pursuant to Section 10(c) of the Act, I hereby make the
following recommended:
ORDER1
The complaint is dismissed in its entirety.
1 In the event no exceptions are filed as provided by Sec 102 46 of the of the Rules and Regulations, be adopted by the Board and become its
Rules and Regulations of the National Labor Relations Board, the findings, findings, conclusions, and Order, and all objections thereto shall be deemed
conclusions, and recommended Order herein shall, as provided in Sec 102 48 waived for all puposes