United Mine E\Workers of America

National Labor Relations Board - Board Decisions

Aug 24, 1977

231 N.L.R.B. 573 (N.L.R.B. 1977)

UNITED MINE WORKERS OF AMERICA
United Mine Workers of America and Lone Star Steel
Company and Surface Industries, Inc. Cases 16-
CB-924, 16-CC-517, and 16-CC-518
August 24, 1977
DECISION AND ORDER
BY CHAIRMAN FANNING AND MEMBERS
JENKINS, MURPHY, AND WALTHER
On January 28, 1976, Administrative Law Judge
James L. Rose issued the attached Decision in this
proceeding. Thereafter, the General Counsel, both
Charging Parties (Lone Star Steel Company and
Surface Industries, Inc.), and the Respondent Union
filed exceptions and supporting briefs. Answering
briefs were filed by Lone Star and the Respondent
Union.
The Board has considered the record and the
attached Decision in light of the exceptions and
briefs and has decided to affirm the rulings, find-
ings,' and conclusions of the Administrative Law
Judge, as modified herein.2
We agree with the Administrative Law Judge that
the Respondent Union did not engage in proscribed
secondary conduct by picketing the operations of
Surface Industries at the Pocahontas mine in an
effort to force Lone Star Steel Company to accept its
bargaining demands, as Surface Industries is an ally
of Lone Star in the latter's labor dispute with the
Union.
Likewise, we agree that the Union did not engage
in unlawful conduct by striking to compel Lone
Star's acceptance of the "successorship" clause as
contained in the National Bituminous Coal Wage
Agreement of 1974.
We disagree, however, with the Administrative
Law Judge's holding that the Union refused to
bargain in violation of Section 8(b)(3) of the Act
insofar as it sought, by striking, to gain Lone Star's
acceptance of the "application of contract" clause, as
in our view the subject matter of that clause
constitutes a mandatory subject of bargaining.
The relevant facts, more fully set forth in the
Administrative Law Judge's Decision, are briefly
summarized below.
I Surface Industnes, Inc.. has excepted to certain credibility findings
made by the Administrative Law Judge. It is the Board's established policy
not to overrule an Administrative Law Judge's resolutions with respect to
credibility unless the clear preponderance of all of the relevant evidence
convinces us that the resolutions are incorrect. Standard Dry Wall Products,
Inc., 91 NLRB 544 (1950), enfd. 188 F.2d 362 (C.A. 3, 1951). We have
carefully examined the record and find no basis for reversing his findings.
2 The Charging Parties filed requests for oral argument. Their requests
are hereby denied as, in our opinion. the record in this proceeding, including
the parties' briefs, adequately presents the issues and the positions taken
with respect thereto.
:' The record shows that Lone Star had likewise been directly engaged in
231 NLRB No. 88
Lone Star Steel Company is a Texas-based manu-
facturer of steel products, principally pipe used in the
oil and gas industry. In connection with its business,
Lone Star consumes 36,000 to 40,000 tons of coal per
month to make coke which, in turn, is used in the
steelmaking process. Coal is obtained both from
outside suppliers and from coal lands owned or
leased by Lone Star, the latter being a part of the
Company's bituminous coal reserves, which are
maintained to assure an adequate supply of this vital
raw material.
In January 1972, Lone Star acquired the Starlight
mine near McCurtain, Oklahoma, for immediate
exploitation of its bituminous coal of medium
volatility. This was done to offset the loss of coal
theretofore furnished by an outside supplier. Follow-
ing this acquisition, and for more than 1 year,
Starlight coal was mined by the River Corporation,
under a contract with Lone Star. Work at the mine
was covered by the terms of the 1971 National
Bituminous Coal Wage Agreement, to which the
River Corporation was a signatory. In April 1973,
Lone Star itself took over operations at the Starlight
mine and assumed, with some minor variances not
here relevant, the aforesaid agreement which was
terminable on or after November 12, 1974. 3
About the same time, Lone Star began investigat-
ing other coal properties with a view toward
acquisition of additional reserves, as a hedge against
loss of high volatility coal sources which were
deemed to be in questionable supply.4 Investigations
centered on certain coal lands near Dow, Oklahoma,
otherwise known as the Pocahontas prospect. On
October 15, 1973, the Company entered into a 10-
year renewable coal lease with the owner of those
lands and in February of the following year began
clearing the property to prepare it for mining. During
the spring and summer of 1974 Lone Star entered
into negotiations with potential mine operators and
in July contracted with All Service Contractors, Inc.,
to mine the Pocahontas prospect.5 This agreement
aborted, however, as All Service was unable to
obtain financing for required machinery and equip-
ment and begin production within the specified time.
Thereafter, a similar agreement was signed with
Murray Construction Co., Inc., on October 22, 1974.
mining operations near Dow. Oklahoma, from the end of World War II
through 1962.
4 Lone Star uses a blend of medium and high volatility coal in its coking
ovens.
5 According to his credited testimony, Johnny Enlow, a founder and vice
president of All Service. inquired of Lone Star officials in the course of these
negotiations, why they did not "do the jobs themselves because they had the
men, the money, and machines to do the jobs . . . and thereby cut out the
middle man." They advised Enlow that Lone Star sought an independent
rmne operator to assure continuous production in the event of an
anticipated strike by UMWA employees upon termination of the current
wage agreement on November 12.
573
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Subsequently, with Lone Star's approval, this con-
tract was assigned to Surface Industries, Inc., a
spinoff corporation organized by the Murray broth-
ers, who had no prior experience in the strip mining
of coal, for the specific purpose of exploiting the
Pocahontas mine.6 Operations commenced in No-
vember and by the first week in December coal was
moving from the mine.
Meanwhile, by letter dated September 9, 1974, the
Union notified Lone Star of its intention to terminate
the 1971 wage agreement on November 12 and
requested that the Company formally agree to be
bound by the terms of any successor national
agreement negotiated by the Union and the Bitumi-
nous Coal Operators' Association. By letter dated
September 30, Lone Star declined, but offered to
meet and negotiate a new contract. No agreement
was reached by November 12, and on that date Lone
Star employees at the Starlight mine joined others in
a nationwide strike. A national agreement was
executed on December 5, 1974, but Lone Star was
unwilling to be bound by its terms and its employees
remained on strike as negotiations continued. On
January 6, 1975, the parties entered into an interim
agreement pursuant to which Lone Star employees
returned to work for a 60-day period to facilitate
negotiations. Bargaining continued, but the Compa-
ny and the Union remained apart on several critical
issues, and on March 8 the strike was resumed. Five
days later, on March 11, Starlight miners appeared at
the Pocahontas mine, near Dow, and began picketing
with signs which read: "Lone Star on Strike for
UMWA Contract." Surface employees refused to
cross the picket line. One bargaining session was held
several months after the strike resumed but the
parties adhered steadfastly to their respective posi-
tions, no agreement was reached, and the strike
continued.
Among other things, the Union insisted upon Lone
Star's acceptance of two clauses, herein called the
"successorship" clause and the "application of
contract" clause, which were negotiated into the
National Bituminous Coal Wage Agreement of 1974.
The successorship clause, a new provision, is set
forth in article I of the aforesaid agreement and reads
as follows:
In consideration of the Union's execution of this
Agreement, each Employer promises that its
6 Enlow, who worked briefly for Surface as a mine superintendent,
credibly testified that J. Paul Savage, Lone Star's director of coal properties,
repeated the Company's reason for seeking an independent operator to mine
the Pocahontas prospect at a conference between the Murray brothers and
representatives of Lone Star, which he attended. Oliver ' Bub" Murray
himself testified that he "asked them why they wanted to take inexperienced
people like us and put us in the coal business or give us a contract on a coal
mine" and was told "they didn't want to tackde the responsibility or the
personnel, which I understand today."
operations covered by this Agreement shall not be
sold, conveyed, or otherwise transferred or
assigned to any successor without first securing
the agreement of the successor to assume the
Employer's obligations under this Agreement.
The application of contract clause, carried over
from the preceding national agreement, is set forth in
article II, section (f), of the agreement and reads as
follows:
As part of the consideration for this Agree-
ment, the Employers agree that this Agreement
covers the operation of all the coal lands, coal
producing and coal preparation facilities owned
or held under lease by them, or any of them, or by
any subsidiary or affiliate at the date of this
Agreement, or acquired during its term which
may hereafter (during the term of this Agreement)
be put into production or use.
As set forth in the addendum to the Union's contract
proposal, it is understood by all the parties that this
clause becomes operative only if the Union is
recognized by an employer or certified by the Board
as the collective-bargaining representative of the
employees involved. The Union's insistence upon
Lone Star's acceptance of the above-quoted clauses
and the strike, partly in support of those demands,
gave rise to the instant proceeding.
Based on foregoing facts, the Administrative Law
Judge held that the Union did not violate Section
8(b)(4)(A) of the Act by insisting that Lone Star
agree to the successorship clause, as the clause itself
did not fall within the proscription of Section 8(e).
Specifically, he did not view transactions of the type
contemplated by the successorship clause, namely,
the sale or transfer of coal properties, as covered by
the "cease doing business with any other person"
language of Section 8(e), thus distinguishing this case
from Commerce Tankers, 7 wherein the Board found
that the sale of vessels in the maritime industry was
not a novel situation but a fairly common occurrence
in the normal course of "doing business." Rather, the
Administrative Law Judge found Cascade Employers
Association8 dispositive of the issues raised herein. In
Cascade the Board concluded that the sale or transfer
of an entire business enterprise is generally to be
viewed, not as "doing business" within the meaning
of Section 8(e), but rather as the substitution of one
7 National Maritime Union of America. AFL-CIO; Commerce Tankers
Corporation (Vantage Steamship Corporation), 196 NLRB 1100 (1972), enfd.
486 F.2d 907 (C.A. 2, 1973).
8 International Union of Operating Engineers, Local No. 701, AFL-CIO
(Cascade Employers Association, Inc., for and behalf of its Employer Member
Tru-Mix Construction Co., Inc.), 221 NLRB 751 (1975).
574
UNITED MINE WORKERS OF AMERICA
entity for another while the conduct of business
continues without interruption.
Following issuance of the Administrative Law
Judge's Decision herein, the Board had occasion in
Harris Truck 9 to consider similar issues in the
context of a transfer of a portion of a business
enterprise. The employer in that case, who was a
party to a collective-bargaining agreement which
contained a provision similar to the successorship
clause here in question, maintained a number of
franchise dealerships for major manufacturers of
trucking equipment and trailers. The Board held in
that case that the selling off of two of its three
facilities was not "doing business" within the
meaning of Section 8(e) even though the transaction
did not result in a liquidation of the employer's entire
enterprise. In so holding, the Board observed that the
two dealerships in question operated as separate
entities, each with its own cadre of employees who
were immediately offered, and accepted, jobs with
the new owners. Accordingly, the Board viewed the
transferred operations as separate business enterpris-
es, "not only surviving and continuing after a formal
change of ownership but, further, as being in the
same employing industry without any apparent
disruption in the normal business relationships
between the new owner and Harris Truck's former
suppliers and customers."
The instant case is similar to Harris Truck in the
foregoing respects. Lone Star operates the Starlight
mine as a separate entity with a number of
employees whose "tenure" at the mine extends
beyond that of its owners. Further, based on past
experience, it is likely that employees would continue
in their jobs at the mine should Lone Star decide to
sell to a successor. In these circumstances, we view
the mining operations at the Starlight prospect as
separate and distinct from Lone Star's other activities
as a steel producer, and, given the "permanent"
character of the miners' jobs at the Starlight
prospect, we find that the sale or transfer of the mine
by Lone Star would amount to no more than a
substitution of one entity for another while the
conduct of business continues without interruption,
and therefore it would not be a transaction within the
Act's protection. Accordingly, we agree with the
Administrative Law Judge that the Respondent
Union did not run afoul of the secondary provisions
9 District No. 71. International Association of Machinists and Aerospace
Workers. AFL-CIO (Harris Truck and Trailer Sales Inc.). 224 NLRB 100
1976).
m0 Allied Chemical & Alkali Workers of America, Local Union No. I v.
Pittshurgh Plate Glass Co.. Chemical Division. 404 U.S. 157 (1971).
" Id. at 179.
12 See. e.g.. Local 24, International Brotherhood of Teamsters, Chauffeurs,
Warehousemen and Helpers of America, AFL CIO v. Oliver. 358 U.S. 283
(1959). minimum truck rental for owner-operators: Fibrehoard Paper
Products Corp. v. N. L. R. B., 379 U.S. 203 (1964). contracting out unit work.
of the Act by striking to compel Lone Star's
acceptance of the successorship clause.
Likewise, we agree that the Union did not, by
engaging in such conduct, refuse to bargain in
violation of Section 8(b)(3) of the Act as, in our view,
the subject matter of that clause constitutes a
mandatory subject of bargaining and the Union is
thus entitled to insist upon its acceptance to the point
of impasse.
In Pittsburgh Plate Glass, 10 the Supreme Court
defined a subject for mandatory bargaining as
involving only those issues which settle an aspect of
the relationship between the employer and his
employees. Although recognizing that matters in-
volving individuals outside the employment relation-
ship do not normally fall within that definition, the
Court recognized that they are not wholly excluded.
The touchstone in such cases is "not whether the
third-party concern is antagonistic to or compatible
with the interests of bargaining-unit employees, but
whether it vitally affects the 'terms and conditions' of
their employment [emphasis supplied]." I The Court
has found in certain instances that third-party
concern did vitally affect the terms and conditions of
employment of bargaining unit employees,12 whereas
in Pittsburgh Plate Glass, supra, it did not. The
instant case is distinguishable from the foregoing in
that the successorship clause does not purport to deal
with individuals outside the employment relationship,
but rather with successor employers, who are likewise
outside that relationship. Notwithstanding this dis-
tinction, we are persuaded that a successor's assump-
tion of any collective-bargaining agreement negotiat-
ed between the Union and Lone Star would be vital
to the protection of Starlight employees' previously
negotiated wages and working conditions, as it is
clear that the general rules governing successorship
guarantee neither employees' wages nor their jobs.'3
In view of the foregoing, we agree that the Union's
insistence upon including in any agreement reached
a provision which would assure the survival of the
fruits of collective bargaining, in the event Lone Star
thereafter should dispose of the Starlight mine, is not
violative of the Act, as agreement in this regard
would vitally affect the terms and conditions of
employment of the miners who survive such a change
in ownership.
13 See. e.g., N LR. B, v. Burns International Security Service, Inc., et al.,
406 U.S. 272 (1972). That case is inapposite here, however, inasmuch as it
dealt with the question of whether a successor's freedom was restncted hy
operation of law (i.e., whether a successor was automatically bound to the
terms of a preexisting agreement). whereas the issue herein is whether
voluntary restrictions upon the freedom of the predecessor (the seller) may
be insisted upon by a union. We are not considering or passing upon the
issues of whether a union may lawfully act to compel compliance with such
a provision or whether a successor employer would be bound by the terms
of such an agreement.
575
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Contrary to the Administrative Law Judge, we
similarly view the "application of contract" clause as
involving a subject for mandatory bargaining. The
Board has recognized that certain "after acquired"
clauses, which involve individuals outside the em-
ployment relationship, vitally affect the interests of
bargaining unit employees and therefore constitute
subjects for mandatory bargaining. In Kroger, 14 the
Board dealt with an employer's breach of a clause
that would have had the effect of adding additional
stores to a bargaining unit covered by a collective-
bargaining agreement, upon presentation of evidence
of a card majority among the new employees. It was
found that the employer's failure to abide by that
clause violated Section 8(a)(5) of the Act. It is clear
that such a finding is permissible only because the
clause itself was deemed to involve a mandatory
subject of bargaining. For, as the Supreme Court
stated in Pittsburgh Plate Glass, supra, the Act does
not require continued adherence to permissive as
well as mandatory terms: "The remedy for a
unilateral mid-term modification to a permissive
term lies in an action for breach of contract ... not
in an unfair labor practice proceeding." 15 Thus,
where an "after acquired" clause contemplates the
accretion or absorption of employees into an existing
unit, the matter constitutes a subject for mandatory
bargaining.
In this case, however, the application-of-contract
clause does not extend the terms of a collective-
bargaining agreement to newly acquired employees
by adding them to the existing unit. Rather, the
clause would extend that agreement in its entirety to
employees of Lone Star, and its subsidiaries and
subordinates, who are concededly outside that unit.
This distinction, in the opinion of the Administrative
Law Judge, deals a fatal blow to the Union's
position. We disagree. It is clear that this clause
serves to protect the jobs and work standards of
bargaining unit employees at the Starlight mine by
removing economic incentives which might otherwise
encourage Lone Stone to transfer such work to other
mines under its control. The fact that the Union
could have sought other specific provisions ad-
dressed solely to the protection of unit employees in
a manner which would remove economic incentives
to the development of other mining facilities at the
expense of the Starlight miners, as the Administrative
Law Judge suggests, does not render the subject
matter of this clause any less vital to the employees'
interests. Nor can it be said that the application of an
entire collective-bargaining agreement to nonunit
employees, including its noneconomic provisions,
'4 Houston Division of the Kroger Co., 219 NLRB 388 (1975).
' 404 U.S. 157, 188.
H* Allied Chemical & Alkali Workers of America, Local Union No. I v.
Pittsburgh Plate Glass Co., Chemical Division, 404 U.S. 157, 178-179 ( 1971).
necessarily reveals a disguised purpose to promote
the Union's institutional or organizational interests.
Indeed, as previously mentioned, the "application of
contract" clause herein is understood to become
operative only if the Union is recognized by an
employer or certified by the Board as the collective-
bargaining representative of the employees to be
covered thereby. In view of the foregoing, we find
that the application-of-contract clause here in ques-
tion deals with a mandatory subject of bargaining
and, accordingly, that the Respondent Union did not
violate Section 8(b)(3) of the Act by striking in
support of its demand that Lone Star agree to its
inclusion in any collective-bargaining agreement
reached. We shall, therefore, 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 hereby orders that the complaint
herein be, and it hereby is, dismissed in its entirety.
MEMBER WALTHER, dissenting in part:
I disagree with the majority's conclusion that the
"successorship" and "application of contract" claus-
es constitute mandatory subjects of bargaining.
Accordingly, I conclude that the Union refused to
bargain in violation of Section 8(b)(3) of the Act by
striking to compel Lone Star's acceptance of these
clauses.
The Supreme Court has defined mandatory sub-
jects of bargaining as those matters which settle some
aspect of the relationship between the employer and
his employees, or those matters which-although
they concern individuals outside the employment
relationship-nevertheless vitally affect the terms
and conditions of employment of bargaining unit
employees.6 The majority states that the successor-
ship clause passes the latter, or "vitally affects" test,
for mandatory subjects of bargaining. In so conclud-
ing, the majority fails to consider that application of
the vitally affects test to third-party concerns, such as
the successorship clause, does not turn "only on the
impact of the third-party matter on employee
interests. Other considerations, such as the effect on
the employer's freedom to conduct his business, may
be equally important [citation omitted]."17 In this
regard, it should be noted that a successorship clause
will have a substantial effect on an employer's
freedom to conduct its business and to dispose of its
capital assets. The Supreme Court has described this
effect as follows:
17 Id., fn. 19 at 179.
576
UNITED MINE WORKERS OF AMERICA
A potential employer may be willing to take over
a moribund business only if he can make changes
in corporate structure, composition of the labor
force, work location, task assignment, and nature
of supervision. Saddling such an employer with
the terms and conditions of employment con-
tained in the old collective-bargaining contract
may make these changes impossible and may
discourage and inhibit the transfer of capital.18
The Court was unwilling in Burns to impose such
restraints on the free transfer of capital and went on
to hold that a successor employer is not bound by the
substantive provisions of the collective-bargaining
agreement negotiated by the predecessor employer).
Under Burns, a successor of Lone Star will not be
bound to observe the substantive provisions of any
collective-bargaining agreement negotiated by Lone
Star. However, by virtue of the successorship clause,
if agreed to by Lone Star and thereafter complied
with, a successor of Lone Star will be obligated to
recognize and bargain with the Union and to assume,
in toro, the burdens of the agreement. Thus, the
successorship clause will achieve precisely what the
Burns court sought to avoid-saddling a potential
purchaser with Lone Star's collective-bargaining
agreement-thereby inhibiting Lone Star's freedom
to dispose of its capital assets. That the successorship
clause achieves this result through a negotiated
agreement rather than through the compulsion of a
Board order, as was the case in Burns, does not make
Burns inapposite here. The restraint on the free
transfer of capital assets is as real when imposed by
private agreement as it is when imposed by a Board
order.
By denoting the successorship clause a mandatory
subject of bargaining, the majority allows the Union
to sidestep the Burns decision. The Union will be free
to engage in economic warfare to compel Lone Star
to agree to include the successorship clause in a
collective-bargaining agreement. With the clause
included in an agreement, Lone Star's freedom to
dispose of its assets will be severely curtailed,
accomplishing precisely what the Burns Court sought
to avoid. For this reason, I cannot join the majority.
In addition, I do not believe that the successorship
clause "vitally affects" the terms and conditions of
employment of bargaining unit employees within the
meaning of Pittsburgh Plate Glass, supra, and
therefore is not a mandatory subject of bargaining.
The majority states that "the Union's insistence upon
including in any agreement reached a provision
i' N L.R.B v. Burns International Securit, Services. Inc., 406 U.S. 272,
287-288 (1972).
i. A successor employer, however, is obligated to recognize and bargain
with an incumbent union in situations where it retains a majority of the
predecessor's employees and the relevant bargaining unit remains un-
changed. Id at 281.
which would assure the survival of the fruits of
collective bargaining, in the event Lone Star thereaf-
ter should dispose of the Starlight mine, is not
violative of the Act, as agreement in this regard
would vitally affect the terms and conditions of
employment of the miners who survive such a change
in ownership." There is no requirement either in the
collective-bargaining agreement or in the Act which
would require a party which subsequently acquires
the Starlight mine to employ former Starlight
employees. It is therefore possible that the successor-
ship clause, if and when it is applied, would benefit
or restrict stranger employees rather than bargaining
unit employees. Under such circumstances, it can
hardly be said the successorship clause vitally affects
the terms and conditions of employment of bargain-
ing unit employees.
I also find it significant that the successorship
clause requires a successor to assume the collective-
bargaining agreement in toro, including noneconomic
provisions which even my colleagues would have to
concede do not vitally affect the terms and condi-
tions of employment of bargaining unit employees.
The proposed agreement, for example, contains
noneconomic provisions for union recognition, union
access to the mine, checkoff of union dues, use of
bulletin boards by the Union, and the use of
company bathhouses for meetings. While these
provisions may vitally affect the Union as an
institution and enhance its position as collective-
bargaining representative, they do not vitally affect
the terms and conditions of employment of bargain-
ing unit employees. Accordingly, to the extent the
successorship clause seeks to continue in effect the
above-described provisions, the clause is not a
mandatory subject of bargaining, and the Union
therefore failed to bargain in violation of Section
8(b)(3) by striking to compel Lone Star's acceptance
of the clause.20
Turning to the application-of-contract clause, I am
able to agree with two aspects of my colleagues'
discussion of this clause. They correctly note that (I)
the Board has indicated that an "after acquired"
clause is a mandatory subject of bargaining when the
clause contemplates the accretion of employees-to
be covered by the collective-bargaining agreement-
into the existing unit,21 and (2) the application-of-
contract clause here does not contemplate such an
accretion. I must, however, part ways with my
colleagues when they conclude that this distinction
does not deal a fatal blow to the contention that the
20 See N. L R. B. v. Wooster Division of Borg-Warner Corp., 356 U.S. 342,
349 (1958).
21 Houston Division of the Kroger Co.. 219 NLRB 388 (1975).
577
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
application-of-contract clause vitally affects the
terms and conditions of employment of bargaining
unit employees. Since the clause will apply the
proposed agreement to nonunit employees, I do not
believe it is a mandatory subject of bargaining. As
the Administrative Law Judge below succinctly
stated:
I simply do not see how applying this contract to
another facility of the company, should it be
created and should the Union be successful in
gaining recognition rights, would have any
bearing on the wages, hours and other terms and
conditions of unit employees.
My colleagues vainly attempt to save the clause as a
mandatory subject of bargaining by finding that the
"clause serves to protect the jobs and work standards
of bargaining unit employees at the Starlight mine by
removing economic incentives which might otherwise
encourage Lone Star to transfer such work to other
mines under its control." The clause, however, is not
restricted to after-acquired facilities competing with
the Starlight mine. Rather, it would take effect and
apply the proposed collective-bargaining agreement
to an after-acquired, noncompeting facility involved
with some aspect of coal production other than
mining. I do not understand how applying the
contract to nonunit employees at an unrelated
facility will protect the jobs and work standards of
bargaining unit employees at the Starlight mine.
It is also significant that the clause does not utilize
other, more precise, means to remove any economic
incentive which otherwise might encourage Lone
Star to transfer work to an after-acquired facility
competing with the Starlight mine. As suggested by
the Administrative Law Judge below, the clause
could have provided that should Lone Star engage in
a competitive operation it would not pay substan-
dard wages or fringe benefits to such employees. This
suggested provision would accomplish the precise
object which the majority states is crucial in making
the application-of-contract clause a mandatory
subject of bargaining, as it would require that the
labor costs at a competing operation match those at
the Starlight mine. Such a precise and narrowly
drawn clause, moreover, would be analogous to
similarly precise and narrow third-party concern
clauses which have been held to be mandatory
subjects of bargaining. Illustrative is the clause in
Local 24, International Brotherhood of Teamsters,
Chauffeurs, Warehousemen and Helpers of America,
AFL-CIO v. Oliver,22 which provided a minimal
rental to be paid owner-operators. The Supreme
22 358 U.S. 283 (1959).
23 Id at 293-294.
Court held this clause was a mandatory subject of
bargaining as its object was "to protect the negotiat-
ed wage scale against the possible undermining
through diminution of the owner's wages for driving
which might result from a rental which did not cover
his operating costs."2 3 As the application-of-contract
clause here is neither precisely nor narrowly drawn to
remove the economic incentives which otherwise
might encourage Lone Star to transfer work to
another mine under its control, I conclude that the
clause does not vitally affect the terms and condi-
tions of employment of bargaining unit employees
within the meaning of Oliver.
It should also be noted that the application-of-
contract clause, like the successorship clause, puts
into effect the proposed collective-bargaining agree-
ment, in toto, including the noneconomic provisions
for union recognition, union access to the mine,
union dues checkoff, union use of bulletin boards,
and union use of bathhouses for meetings. It is clear
that these provisions have no bearing on bargaining
unit employees' terms and conditions of employ-
ment. To the extent the application-of-contract
clause seeks to apply these provisions to after-
acquired facilities, the clause is a nonmandatory
subject of bargaining, and the Union therefore failed
to bargain in violation of Section 8(bX3) by striking
to compel Lone Star's acceptance of the clause.24
Lastly, I believe the application-of-contract clause
is not a mandatory subject of bargaining because it
places an impermissible restraint on Lone Star's
freedom to dispose of its assets. As discussed above
in connection with the successorship clause, the
Supreme Court in Burns has expressed a policy
favoring the right of employers to dispose of capital
assets free of the restraints which would arise if a
successor employer were bound by the provisions of
the collective-bargaining agreement negotiated by
the predecessor employer. The application-of-con-
tract clause implicates the same policy considerations
underlying Burns. Assuming the application-of-con-
tract clause is contained in a collective-bargaining
agreement negotiated by Lone Star, its decision
thereafter whether or not to acquire a new facility
would occur under the shadow of that clause. In the
absence of that shadow Lone Star might be willing to
acquire a new facility as it would be able to make
"changes in corporate structure, composition of the
labor force, work location, task assignment and
nature of supervision." 25 But the clause has the effect
of "[sladdling [Lone Star] with the terms and
conditions of employment contained in the old
collective bargaining contract [which] may make
24 Borg. Warner Corp., supra. 356 U.S. at 349.
25 Burns, supra, 406 U.S. at 287-288.
578
UNITED MINE WORKERS OF AMERICA
these changes impossible and may discourage and
inhibit the transfer of capital." 26 Accordingly, as was
the case with the successorship clause, I conclude
that, by denoting the application-of-contract clause a
mandatory subject of bargaining, the majority allows
the Union to thwart the policy of the Burns decision.
As a result of the majority's decision, the Union will
be free to engage in economic warfare to compel
Lone Star to agree to include the clause in a
collective-bargaining agreement. If the clause is so
included, Lone Star's freedom to dispose of its
capital assets will be impermissibly limited under
Burns.
For the foregoing reasons, I would find that
Respondent's conduct with respect to both the
successorship and application-of-contract clauses
violated Section 8(b)(3).
26 Id at 288.
DECISION
STATEMENT OF THE CASE
JAMES L. ROSE, Administrative Law Judge: These
matters came on for hearing at McAlester, Oklahoma,
from October 21 through October 24, 1975, upon the
Regional Director's complaints alleging, in general terms,
that the United Mine Workers of America committed
unfair labor practices by: (1) bargaining to impasse over a
nonmandatory subject of bargaining (the application of
contract to coal lands) and over an unlawful successorship
clause in violation of Section 8(b)(3); (2) engaging in
unlawful inducement and encouragement to achieve a
clause unlawful under Section 8(e) (the successorship
clause) in violation of Section 8(bX4)(A); and (3) engaging
in secondary boycott picketing in violation of Section
8(b)(4)(i) and (ii)(B).
Subsequent to the hearing, all counsel submitted briefs
which have been duly considered and upon the record as a
whole, including my observation of the witnesses, argu-
ments and briefs of counsel, I make the following findings
and conclusions:
I. JURISDICTION
Lone Star Steel Company is Texas based and manufac-
tures steel products, principally pipe for use in the oil and
gas industry. In connection with its business, it uses 36,000
to 40,000 tons of coal per month to make coke, which in
turn is used in the steelmaking process. During the past
year Lone Star purchased and received materials from
outside the State of Oklahoma valued in excess of $50,000
and shipped to points outside the State of Oklahoma
material valued in excess of $50,000. It is admitted, and I
find, that Lone Star is an employer engaged in commerce
within the meaning of Section 2(6) and (7) of the Act.
II. THE LABOR ORGANIZATION INVOLVED
United Mine Workers of America represents employees
in industries affecting interstate commerce, including the
employees of Lone Star Steel Company. It is admitted, and
I find, that the United Mine Workers of America is a labor
organization within the meaning of Section 2(5) of the Act.
III. THE ALLEGED UNFAIR LABOR PRACTICES
A. Factual Background
The parties are in general agreement concerning the
factual situation. Briefly, for many years Lone Star has
purchased coal from various sources, including coal mines
in Oklahoma. Also Lone Star owns the mineral rights to
coal fields, some of which are kept in reserve while others
are mined for current needs.
Lone Star owns the rights to coal at a mine which is
variously described by the witnesses as the Star Light or
McCurtain (a nearby town in southeastern Oklahoma)
mine. Prior to April 1973, this coal was being mined by the
River Corporation. At that time, for reasons not material
nor detailed in the record, Lone Star determined to mine
the coal with its own employees and began to do so.
In connection with this, Lone Star took over and became
a party to the National Bituminous Coal Agreement
between the United Mine Workers of America and River
Corporation. Although some terms were changed by
addendum, basically the agreement was followed by Lone
Star and the Respondent Union.
By its terms, the agreement would terminate on Novem-
ber 12, 1974. On September 7, 1974, the Respondent gave
notice to all independent signatories to the agreement, of
which Lone Star was one, that it wished to terminate the
agreement and negotiate a new one. During the period
when the Respondent was negotiating with the Bituminous
Coal Operators' Association, representatives of the Re-
spondent also met with the vice president and general
counsel of Lone Star. Apparently Lone Star sought more
favorable terms than were ultimately agreed to by the
Operators' Association.
In any event, along with other members of the Respon-
dent nationwide, on November 12, 1974, employees of
Lone Star engaged in an economic strike in order to force
their bargaining position. Contract talks continued as did
sessions between representatives of Lone Star and repre-
sentatives of the Union. The Operator's Association and
the Union came to an agreement; however, Lone Star did
not, and its employees continued to strike.
In late December 1974, Lone Star suggested that the
employees should return to work for a period of 90 days so
that negotiations could continue in a less adversary
context. Union representatives agreed to recommend to its
National Executive Board, as well as to the local union
membership, a return to work for 60 days. The National
Executive Board and the local union membership con-
curred and on about January 6, 1975, the employees did in
fact return to work.
There followed negotiation sessions, but the parties
remained apart on some terms. Thus, no agreement was
reached by March 6, and the Company asked that the
579
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
employees refrain from striking for another 7 days. The
union representatives apparently agreed to this; however,
this time a majority of the employees would not continue to
work without a contract. On or about March 6, 1975,
employees at Lone Star again went on strike which
continues to date.
Paralleling these events, sometime in the summer of
1974, Lone Star made a decision to commence mining its
coal reserves at a mine approximately 50 miles from the
Starlight mine, variously referred to as the Dow (the name
of a nearby town) or Pocahontas mine. Representatives of
Lone Star testified that inasmuch as they really are not in
the coal mining business they determined to have this mine
operated by a subcontractor who would be paid on a per-
ton basis. Tentative contracts were apparently made with
several individuals or companies, and finally an agreement
was entered into between Lone Star and an organization
called Surface, Incorporated, a corporation organized for
the specific purpose of engaging in mining activity at the
Dow mine. This company is a spinoff corporation of the
basic Murray brothers partnership, three brothers who
engage in various type of construction work and do
business through several different entities.
Inasmuch as the Murray brothers were not familiar with
strip coal mining, representatives of Lone Star were always
present at the Dow mine to watch over the operation,
although Surface had its own people as the supervisors and
managers.
Sometime in the first part of November 1974, Surface
began hiring employees and mining the coal and did so
until on or about March I 11, 1975, when a majority of its
employees ceased working.
In the latter part of January 1975, the Respondent began
an organizational campaign among Surface's employees.
There is testimony that some 33 authorization cards were
signed among the 36 employees. A representation petition
was filed in February but has not been acted on, unfair
labor practice charges filed by the Union having blocked
further processing.
On March 11, 1975, pickets from the employees of Lone
Star appeared at the Dow mine. On that day the Dow
employees ceased working.
Prior to March 11, Surface had engaged in certain
activity which led the Union to file unfair labor practice
charges which in fact are the subject of the complaint in
Case 16-CA-6006, currently pending before an Adminis-
trative Law Judge.' The Union argues, therefore, that the
strike by Surface employees was both to protest the
Company's unfair labor practices and to seek recognition.
An injunction against further picketing by the United
Mine Workers at the Dow mine was entered by the United
States District Court for the District of Oklahoma on
March 18, 1975. There has been no subsequent picketing
although employees of both Lone Star and Surface
continued to strike.
The employees of Lone Star are and have been members
of the Respondent Union. The employees of Surface are
not members but have filed authorization cards to have the
Union represent them. Presumably, they will become
I Administrative Law Judge Anne F. Schlezinger issued her decision,
J D--76, on January 15, 19761224 NLRB 155].
members if and when the Union gains recognition and
finally executes a contract with Surface.
The parties stipulated that prior to March 11, 1975, the
employees of Surface had a right to strike for recognition
and had reasonable cause to believe that sufficient unfair
labor practices had been committed by Surface to justify
their striking in protest.
Nevertheless, Surface charges, and the General Counsel
alleges, that when Lone Star employees picketed the Dow
mine, the Union thereby violated Section 8(b)(4) of the
Act. The Union argues that either Surface was an ally of
Lone Star and/or Surface employees had a right to strike.
Thus the picketing by Lone Star employees was not an
inducement to cease work, rather their own problem with
Surface led them to strike.
B. Issues
The General Counsel's complaint, the Respondent's
answer, and this factual situation thus present the following
questions:
1. Whether the Union struck over a contract clause
proscribed by Section 8(e) - the successorship clause - in
violation of Section 8(a)(4)(A) and 8(b)(3).
2. Whether the Union struck over a contract clause
involving a nonmandatory subject of bargaining - the
application of contract to coal lands - in violation of
Section 8(b)(3).
3. Whether picketing at the Dow mine, on and after
March 11, 1975, was violative of Section 8(b)(4)(i) and/or
(ii)(B).
C. Discussion
The essence of the 8(b)(3) refusal-to-bargain allegation is
that the Union bargained to impasse over one clause which
the General Counsel claims is illegal and another which is
not a mandatory subject of bargaining. For convenience,
these respectively will be referred to as the successorship
clause and the application-of-contract clause.
The successorship clause is found in article I and reads as
follows:
In consideration of the Union's execution of this
Agreement, each Employer promises that its operations
covered by this Agreement shall not be sold, conveyed,
or otherwise transferred or assigned to any successor
without first securing the agreement of the successor to
assume the Employer's obligations under this Agree-
ment.
The application-of-contract clause is found in article II,
section (f) of the contract and reads as follows:
Application of This Contract to the Employer's Coal
Lands
As part of the consideration for this Agreement, the
Employers agree that this Agreement covers the
operation of all the coal lands, coal producing and coal
preparation facilities owned or held under lease by
580
UNITED MINE WORKERS OF AMERICA
them, or any of them, or by any subsidiary or affiliate
at the date of this Agreement or acquired during its
term which may hereafter (during the term of this
Agreement) be put into production or use.
These clauses were proposed by the Union and were
ultimately negotiated into the National Bituminous Coal
Wage Agreement of 1974.
There is thus no question that the Union asked for and
obtained a contract containing the terms in question - at
least as to most employers. There is also no question that
Lone Star, acting through its vice president and general
counsel, rejected these clauses during negotiations.
The Union recognizes that, as written, the application-of-
contract clause could lead to an unlawful implementation.
Thus, amended language is to the effect that the contract
could not apply to a new operation of Lone Star unless and
until the Union gained representation rights among the
employees either through authorization cards and/or a
representation election.
Lone Star's vice president and general counsel, Howard
Jensen, testified concerning the bargaining sessions and the
Company's position with regard to these clauses. For
instance, in a December meeting with union representa-
tives, Jensen stated: "I had very serious reservations about
the new successorship clause . . . and I had reservations
about the accretion clause."
In a subsequent meeting Jensen again told the union
representative that Lone Star was not agreeing to the
successorship or the application-of-contract clauses be-
cause they were illegal or in any event were not mandatory
subjects of bargaining.
Finally Jensen stated in letters to the Union that the
parties were in basic disagreement over four items,
including the successorship and application-of-contract
clauses.
Richard M. Bank, executive assistant to the Respon-
dent's International president and the principal union
representative negotiating with Jensen, testified that the
Union took the position throughout that the clauses were
important and legal. In any event, Bank stated that Lone
Star did not offer substitute language for either and that
the Union was willing to consider any reasonable compro-
mise on these issues.
Indeed, the record supports Bank's testimony that the
Union did make some changes in language to conform to
proposals by Lone Star - particularly including the matter
of the cost-of-living escalator and the termination clause.
A reasonable evaluation of the total record is that the
Union proposed two clauses by which it sought to protect
its membership and its work jurisdiction and which could
be used in organizing. For what appears to be legitimate
business reasons, the Company rejected the Union's
proposed language.
These two items, among other things, were matters of
disagreement when the strike recommenced. The strike, in
part at least, was to achieve a contract containing these
subjects.
It is alleged the Union bargained to "impasse" over these
clauses and by striking to achieve them violated Section
8(b)(3).
The Successorship Clause
In International Union of Operating Engineers, Local No.
701 (Tru-Mix Construction Co.), 221 NLRB 751 (1975),
decided after the hearing in this matter, the Board held that
a clause of substantially the same import as the successor-
ship clause here is not proscribed by Section 8(e). A
majority of the panel concluded that in spite of a transfer
of all, or substantially all, of a company's assets, the
business enterprise nevertheless survives and is the same
employing industry. Therefore, the transferring of assets is
not "doing business" within the meaning of Section 8(e) of
the Act. That is, in the event of a sale of assets or change of
ownership, the company would continue to engage in its
normal business with its customers and these relationships
would not necessarily be affected. It is what the company
does in industry which constitutes "doing business," or the
lack of it, within the meaning of Section 8(e).
The Board, in its Tru-Mix decision, distinguished
National Maritime Union, AFL-CIO (Commerce Tankers
Corporation), 196 NLRB 1100 (1972), enfd. 486 F.2d 907
(C.A. 2, 1973), cert. denied 416 U.S. 970 (1974). There it
was concluded that in the maritime industry the buying
and selling of ships is a common matter and is an aspect of
the normal business dealings engaged in by ship compa-
nies. Therefore, the buying or selling of a vessel is "doing
business" within the meaning of Section 8(e) and contrac-
tual restrictions upon these dealings are violative of Section
8(e).
Lone Star argues that it is a fully integrated steel
company whose business includes buying and selling of
coal properties. Thus, its situation is analogous to buying
and selling ships as an aspect of its "doing business."
Lone Star does buy coal and properties in order to
supply its coke ovens. But its business is making steel, not
selling coal lands. In addition, should Lone Star sell the
Starlight mine, the mine would continue as the employing
entity, even though the ownership changed. The "doing
business" in this case is mining coal and related endeavors
- not selling coal properties. Under the test in Tru-Mix,
the successorship clause is not proscribed by Section 8(e).
And it is a mandatory subject of bargaining. To insure
that a successor to Lone Star would continue in force and
effect all the wages, hours, and other terms and conditions
of employment obviously relate to those matters as to
bargaining unit employees. That a successor would pay the
negotiated wage rate, for instance, is surely as important to
the employees as Lone Star paying the rate.
Having concluded that the successorship clause is not
proscribed by Section 8(e), it follows that striking and
picketing to achieve such a clause is not violative of Section
8(b)(4XA). And to strike to achieve it is not a refusal to
bargain under Section 8(bX3) since it is a mandatory
subject of bargaining.
The Application-of-Contract to Coal Lands Clause
as a Subject of Bargaining
The parties sometimes refer to this clause as an accretion
clause. It does not, however, by its language purport to
accrete into an already existing bargaining unit new
employees of a new operation.
581
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
As noted above, such impurities in the clause as may
exist in the National Agreement may have been cured by
the Union's most recent proposed language as to when and
under what conditions the Company would be required to
apply the contract to a new operation. The General
Counsel has not alleged this clause to be violative of the
Act on its face, but only that it concerns a nonmandatory
subject of bargaining.
The thrust of the General Counsel's argument is that, by
applying the entire contract to new operations, the Union
seeks more than simply attempting to preserve bargaining
unit standards. It seeks also items of institutional interest
particularly including, apparently, a facility to organize
new employees. In support of his position, the General
Counsel cites Oil, Chemical & Atomic Workers International
Union [Shell Oil] v. N.L.R.B., 486 F.2d 1266 (C.A.D.C.,
1973), and Local 445, International Union of Electrical,
Radio and Machine Workers, AFL-CIO (Sperry Rand), 202
NLRB 183(1973).
The Respondent, on the other hand, argues that a
contract clause which seeks to affect terms and conditions
of employment of persons outside the bargaining unit is
mandatory where such "vitally" affect unit employees,
citing Local 24, International Brotherhood of Teamsters,
Chauffeurs, Warehousemen and Helpers of America, AFL-
CIO v. Oliver, 358 U.S. 283 (1958); and Allied Chemical &
Alkali Workers of America, Local Union No. I v. Pittsburgh
Plate Glass Co., Chemical Division, 404 U.S. 157 (1971).
In all the cases relied on by the General Counsel and the
Respondent, certain provisions of a contract were extended
to employees outside the bargaining unit. This, however, is
not that type of situation. Here no contract terms will
apply to nonunit employees. Rather, should the Company
create a situation in which another bargaining unit
materializes and thereafter should the Union succeed in
getting representation rights for those employees, then the
contract would automatically be accepted by the employer
- whether that employer be Lone Star or an affiliate to
Lone Star.
Such may have some elements of protecting unit work or
negotiated standards of unit employees. The clause,
however, goes beyond these matters and becomes, among
other things, an organizing tool.
Unit standards could be protected simply by a clause
requiring Lone Star, should it open a new mine, to pay
employees no less than the wages set forth in the contract.
It could do so without the contract automatically and in
every respect applying to the new operation as the
proposed clause does. Further, the clause could operate in
areas not necessarily competitive with the work unit
employees are doing, e. g., coal preparation facilities as
opposed to mining; and to that extent it goes beyond
protecting unit work and standards.
A fair interpretation of this clause, along with Bank's
testimony, is that a principal purpose for the application of
contract to coal lands is to facilitate organizing.
If it were simply to protect unit standards, then it could
be written as the clause in Oliver, but such would not
necessarily be as effective in organizing employees.
Additionally, this clause can only protect the unit stan-
dards in the event that the Union is successful in
organizing the employees of the new facility. If it is not
successful, then the Company can apply such wages and
conditions as it wishes, conceivably to the detriment of
negotiated standards.
By this clause, the Union is seeking an agreement in
advance that should the Employer open a new and distinct
facility involving coal preparation or production and not
just a coal mine, and should the Union be successful in
obtaining recognition rights for the employees of that new
facility, then the Company will have to accept the already
agreed-upon contract. The question is whether this is a
mandatory subject of bargaining.
Is it reasonable to say that the subject sought to be
negotiated by the Union was the protection of unit
standards or was it broader, including matters of institu-
tional interest such as organizing nonunit employees? If it
is simply the former, then it is mandatory. If it is of the
latter, then there is some question as to whether or not it is
mandatory.
It does not appear that the Board or courts have decided
this precise issue; however, the matter of after-acquired
property clauses has been considered, most recently in
Houston Division of the Kroger Co., 219 NLRB 388 (1975),
and Smith's Management Corporation, d/b/a Mark-it-
Foods, 219 NLRB 402 (1975). A divided Board decided
these matters accepting the court's remand in Retail Clerks
International Association Local No. 455, AFL-CIO v.
N.L.R.B., 510 F.2d 802 (C.A.D.C., 1975).
The factual situation in each is substantially the same.
There was an existing multistore bargaining unit in the
retail store industry. The recognition clause to which the
parties had agreed, and implemented for a number of
years, provided that new stores be accretions to the
multistore unit. And the contract would apply to the new
stores.
At issue was whether the "additional store clauses" were
valid in situations where the union demonstrated majority
status by authorization cards or whether, in spite of the
existence of such clauses, the employer nevertheless can
insist on a Board conducted election. It was finally
concluded by a Board majority that such clauses are valid
and constitute a waiver of the employer's right to demand
an election, and that "national labor policy favors
enforcing their validity." The Board ordered that upon
request the company was to apply and extend to employees
at the new stores "as part of the appropriate unit" the
existing collective-bargaining agreement and give the
agreement retroactive effect.
In Young and Hay Transportation Company, 214 NLRB
252 (1974), the Board found valid an after-acquired clause
at the same time holding that neither the clause nor the
Board's certification at the new facility meant that the new
facility merged into the preexisting bargaining unit.
Therefore, the company did not refuse to bargain by
refusing the union's demand that bargaining be conducted
on the basis of a multifacility unit.
An unambiguous after-acquired clause will be given
effect whether it contemplates the new facility being
merged into a preexisting bargaining unit or not. Thus
Board law permits a company and a union to negotiate for
582
UNITED MINE WORKERS OF AMERICA
future employees in a future bargaining unit as the
Respondent here demands.
However, whether an after-acquired clause is a mandato-
ry subject of bargaining is another matter - and one not
an issue in any of these cases. In the Kroger line of cases,
the clause related to the scope of the bargaining unit and
was presumably mandatory. The starting point for collec-
tive bargaining is the bargaining unit; and whether new
employees will or will not be absorbed into the bargaining
unit reasonably relates to employment conditions of unit
employees, especially with regard to future negotiations.
Given the Board's approach in these cases, and the nature
of the order - that the employer accept the contract,
including the "after acquired store" clause, as to the new
store, it seems implicit that such a clause is in the realm of
mandatory subjects. However, the clause in Young and Hay
and the one here do not relate to the existing bargaining
unit.
The application-of-contract clause does not purport to
"accrete" into the existing bargaining unit employees of a
new facility. Indeed, not knowing the nature of the
operation which the Employer might start up and to which
this contract would then be applicable, it is not possible to
tell whether a multifacility bargaining unit would even be
appropriate should such be petitioned for. Certainly, the
Employer could begin to process coal at another facility in
such a manner that the employees doing the work would
not appropriately be part of the bargaining unit here.
The application-of-contract to coal lands clause, as
modified by the Union, sufficiently protects the Section 7
rights of the prospective new employees. It is not alleged to
be unlawful, and I conclude it is not. It is a clause which
the parties could agree to and would be given effect by the
Board. But I do not believe that it is a mandatory subject of
bargaining.
In order to be a mandatory subject of bargaining the
subject must relate to wages, hours, or other terms and
conditions of employment in the bargaining unit. N.L.R.B.
v. Wooster Division of Borg-Warner Corporation, 356 U.S.
342 (1958). To set wages for nonunit employees may very
well affect the wages of unit employees and therefore be
mandatory. Local 24, Teamsters v. Oliver, 358 U.S. 283
(1958). However, to agree in advance concerning the terms
and conditions of employment of nonexistent employees in
a new and nonrelated facility does not particularly relate to
wages, hours, or the terms and conditions of employment
of unit employees. I simply do not see how applying this
contract to another facility of the Company, should it be
created and should the Union be successful in gaining
recognition rights, would have any bearing on the wages,
hours, and other terms and conditions of unit employees.
Nor would implementation of this clause reasonably
affect unit jobs, except in the situation where the Company
would open another mine. This clause, by its terms, goes to
all phases of coal production and not just mining. Finally, I
do not believe that the principal purpose of this clause is to
protect unit standards. That could be done in other ways,
for instance, by providing that the Employer would not
engage in a competitive operation and pay employees less
or grant them less favorable working conditions.
I conclude that the principal purpose for the application-
of-contract clause is as an organizing device. As such, while
not illegal and certainly from the union standpoint
desirable, nevertheless it does not relate to wages, hours,
and other terms and conditions of employment of unit
employees. This clause cannot be considered a mandatory
subject of bargaining. To negotiate a contract covering
nonexistent employees in a nonexistent bargaining unit
may be permissible, but it is not required.
The record is clear that the Union is engaging in a strike
to achieve its bargaining proposals, including the applica-
tion-of-contract to coal lands clause and to that extent it is
striking over a nonmandatory subject of bargaining.
It is argued that the Union bargained to impasse over the
application clause and therefore violated Section 8(bX3).
Impasse is a plastic concept and not really material here.
Whether the parties reached an impasse, and if so when,
need not be decided. The Union can strike to force its
bargaining position, whether or not there has been an
impasse. It cannot, however, strike to force the Company
to accept a nonmandatory subject of bargaining even if
there was no impasse. To the extent it is striking to achieve
agreement on a nonmandatory subject, it is refusing to
bargain within the meaning of Section 8(b)(3), e. g., Local
445, Intl. Union of Electrical Radio and Machine Workers,
AFL-CIO (Sperry Rand), 202 NLRB 183 (1973).
Striking and Picketing at the Starlight Mine
On November 12, 1974, employees of Lone Star, along
with other members of United Mine Workers, commenced
an economic strike in furtherance of their contract
demands. The strike was settled nationally when the
contract was executed. Thereafter, Lone Star employees
continued to strike until it was determined by agreement of
the parties that they would return to work for 60 days in an
effort to work out a settlement to the contract. This they
did on January 6, 1975. They continued to work until
March 6, 1975, at which time they again struck.
In connection with the strike, Lone Star employees have
picketed the Starlight mine.
This strike is alleged by the General Counsel to be
violative of the Act only insofar as it is in furtherance of the
Union's demand concerning a permissive subject of
bargaining and/or for an unlawful contract clause. The
General Counsel does not allege that the strike and
picketing activity at the Lone Star facility is in any other
respect violative of the Act.
Inasmuch as I have concluded that the successorship
clause is not violative of Section 8(e), the strike and
picketing of Lone Star would not be violative of Section
8(bX4XA).
The strike does, however, violate Section 8(bX3) to the
extent that one factor concerns the Union's demand for a
nonmandatory subject of bargaining.
The Strike and Picketing Activity by Lone Star
Employees at the Dow Mine
A few days after they recommenced striking, the Lone
Star employees put up picket signs and walked with picket
signs in the vicinity of the gate to the Dow mine.
583
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Thereafter, and reasonably as a result of this picketing,
Surface employees of the Dow mine ceased working and
they continue to strike to the present time.
The Respondent argues that Surface employees had a
right to strike, namely, to protest unfair labor practices
and/or for recognition. However, it is more probable that
these employees left work when they did, on March 11,
1975, because of the picketing by Lone Star employees.
Conversely, had the Surface employees been motivated
only by their desire to protest unfair labor practices or to
seek recognition, it follows they would have begun striking
prior to March 11, if not on February 25 or shortly
thereafter. The point is, if the Surface employees had
reason to believe they could and should engage in an unfair
labor practice strike and/or to seek recognition, they
reasonably would have begun striking earlier. Not having
done so, the conclusion is inescapable that they would not
have gone out on March II but for the picketing.
The Surface employees may very well have had legiti-
mate reasons to engage in a work stoppage, and they may
very well at this time be entitled to such benefits as accrue
to unfair labor practice strikers. Nevertheless, it must be
found that a precipitating cause of their ceasing work on
March 11, 1975, was the picket activity engaged in by Lone
Star employees. The question is whether the picketing was
secondary and violated the Act.
Although Lone Star had employees, actually representa-
tives of management, at the Dow facilities at all times to
superintend the excavation of the coal, and although Lone
Star owned the right to the coal being excavated,
nevertheless, it is concluded that the Dow mine was not
sufficiently a primary situs of Lone Star's work so as to
render the picketing primary from that standpoint.
However, it is concluded that Surface is sufficiently
allied with Lone Star so as not to be considered a neutral
with regard to Lone Star's labor dispute with its employees.
From the totality of the evidence it is concluded that the
principal reason Lone Star determined to have the coal at
the Dow mine excavated by employees of a subcontractor,
rather than hiring its own, was the prospect of a 1974
strike. The timing is significant. While Lone Star keeps
much of its coal in reserve, it was only in the late summer
of 1974 that it determined to start mining the Dow mine.
Further, it reasonably appears from the testimony and the
evidence that a reason Lone Star started to mine the Dow
coal was to have an alternative source of supply should the
Starlight facility be shut down.
There was much testimony that the Dow coal is not
identical to, and would not be a substitute for, the Starlight
coal. Nevertheless, from all of the chemical properties it
does appear that the Dow coal, when mixed with coal from
other sources, could reasonably be a replacement for the
Starlight coal and indeed has been. Thus, without Starlight
coal but with Dow coal mixed with other coal, Lone Star
was able to make coke.
I credit the testimony of Johnnie Enlow to the effect that
Lone Star sought an independent subcontractor to mine
the coal so that it would have an alternative source of
supply in case of a strike. And I discredit testimony
indicating otherwise - specifically the testimony of J. Paul
Sanvage. It is more probable that the possible strike was
the reason Lone Star chose to operate through a subcon-
tractor rather than the reasons given by Lone Star
witnesses. Specifically, it is noted that, now and since 1973,
Lone Star has operated the Starlight mine which is located
only 50 some miles from the Dow mine. For Lone Star
management to say that they are not primarily in the
business of mining coal is just simply not the case. Lone
Star is experienced in coal mining yet, it contracted the
Dow work to an experienced operator. This has to have
been less efficient, if for no other reason than Lone Star
management had to keep in fairly close supervision.
I conclude that the arrangement originated by Lone Star
to have its reserves mined by an independent contractor
created an ally situation, even though Dow coal has
somewhat different properties from the Starlight coal. Dow
is Lone Star's mine. And the coal goes into Lone Star's
coke ovens. From the totality of the evidence, including the
fact that Lone Star owned the coal, used the coal, had
management superintending the excavation by an inexperi-
enced operator, set up the operation in late October 1974,
just weeks before the national strike, it is concluded that
Surface is not a neutral employer in the sense of Section
8(bX4). Rather, Surface is an ally and for Lone Star
employees to picket the premises where Surface was
operating was not for an object proscribed in subsection
(B) of 8(bX4). Hence the picketing was not violative of
Section 8(bX4)(i) or (iiXB). Graphic Arts International
Union (G.A.I.U.), Local Number 277; and Graphic Arts
International Union, AFL-CIO (S & M Rotogravure Service,
Inc.), 219 NLRB 1053 (1975).
Finding Surface to be a legal "ally" does not imply that
the Murray brothers were privy to Lone Star's planning or
even knew what they were getting into. I believe from their
testimony that the Murrays, who are in the construction
business in various ways, were not aware of the potential
hazards involved. Nevertheless, for purposes of Section
8(bX4), Surface is an "ally." I note also that Lone Star is
paying expenses, including legal fees, incurred by Surface
with regard to these matters, further indicating that, as to
this labor dispute and the work involved, the parties
consider themselves allied.
Two further matters should be mentioned. First, on the
day that the Starlight employees began picketing the Dow
mine, Surface attempted to set up a separate gate for Lone
Star employees. The testimony, however, is to the effect
that, while this may have been the aim, no separate gate
ever effectively functioned. Indeed, the bulldozer operator
who was sent out to set up the separate gate testified that
the road which Surface sought to have used by Lone Star
employees was impassable inasmuch as there was a ditch
across it. The road could not have been used without filling
in the ditch.
The other matter concerns Dow employees' right to
strike without regard to Lone Star picketing. No doubt
Dow employees did and do have the right to strike for
recognition and to protest alleged unfair labor practices.
This right, however, has no materiality to the question of
whether or not picketing by Lone Star employees is
proscribed by the Act. The activity engaged in by Lone
Star employees must stand on its own which, it is
concluded, was lawful picketing of an allied employer. No
584
UNITED MINE WORKERS OF AMERICA
determination here is made with regard to the alleged
unfair labor practices engaged in by Surface as to its
employees or the representation matter. (See fn. 1.)
IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES
The conduct of the Respondent outlined above, occur-
ring in connection with the operations of Lone Star as set
forth in section I, has a close, intimate, and substantial
relationship to trade, traffic, and commerce among the
several States and tends to lead to labor disputes burdening
and obstructing commerce and the free flow of commerce.
V. THE REMEDY
Having found that the Respondent has violated the Act
by forcing, through strike activity, the Company to accept
its demand for a nonmandatory subject of bargaining, I
shall recommend that the Respondent be required to cease
and desist from continuing such activity.
However, inasmuch as the parties agree that other
subjects remained to be resolved, I shall not recommend
that the strike itself be found to be an unfair labor practice.
Rather, it appears that the policies of the Act can be fully
effectuated by requiring the Union to withdraw its demand
for the application of contract to coal lands clause and to
bargain with the Company upon request concerning other
matters.
I shall also recommend that the Respondent be required
to send a copy of the attached notice to its striking
members, as well as copies to the Company for posting
upon such bulletin boards as the Company may deem
appropriate.
The Respondent's defense in this matter is certainly not
frivolous - it having prevailed on most points - so as to
warrant an award against it of costs of litigation incurred
by the Company. Lone Star's request for attorneys fees is
therefore denied. Cf. Tiidee Products, Inc., 194 NLRB 1234
(1972).
CONCLUSIONS OF LAW
1. The Lone Star Steel Company is an employer
engaged in interstate commerce within the meaning of
Section 2(6) and (7) of the Act.
2. The Respondent is a labor organization within the
meaning of Section 2(5) of the Act.
3. The allegation in the complaint that the Respondent
violated Section 8(bX3) of the Act by insisting on the
Company's acceptance of a nonmandatory subject of
bargaining (the application-of-contract to coal lands) has
been sustained.
4. The allegation in the complaint that the successor-
ship clause is violative of Section 8(e) of the Act has not
been sustained.
5. The allegation in the complaint that the Respondent
engaged in unfair labor practices within the meaning of
Section 8(bX4)i) and (iiXA) of the Act has not been
sustained.
6. The allegation in the complaint that the Respondent
engaged in picketing activity in violation of Section
8(bX4Xi) and (iiXB) of the Act has not been sustained.
[Recommended Order omitted from publication.]
585