American Ship Building Co. v. NLRB

Supreme Court of the United States · 1965 · Labor Law

Labor LawLockoutsUnfair Labor PracticesCollective Bargaininglockoutbargaining impasseeconomic pressuresection 8(a)(1)

Facts

American Ship Building and eight unions bargained over a new contract, but after extended negotiations they reached an impasse on August 9, 1961. Two days later the employer temporarily laid off employees and shut down parts of its operations, stating that the layoffs were because the labor dispute remained unresolved. The Board found that the layoffs occurred after impasse and that the employer's purpose was to bring economic pressure on the unions to secure a prompt settlement on favorable terms. The Board did not find that the employer acted out of union hostility or to evade its duty to bargain.

Issue

Whether an employer commits an unfair labor practice under NLRA §§ 8(a)(1) and 8(a)(3) when, after a bargaining impasse has been reached, it temporarily locks out employees solely to apply economic pressure in support of its bargaining position. More specifically, the question was whether such a lockout interferes with protected bargaining or strike rights, or discriminates to discourage union membership.

Rule

An employer violates neither § 8(a)(1) nor § 8(a)(3) when, after a bargaining impasse has been reached, the employer temporarily shuts down and lays off employees for the sole purpose of bringing economic pressure to bear in support of a legitimate bargaining position. A violation of § 8(a)(3) requires a proscribed purpose to discourage union membership or otherwise discriminate against the union, not merely an intent to affect the outcome of bargaining.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

Prairie Forge Works, a manufacturer in Peoria, Illinois, bargains with a certified union over wages and health contributions. After months of meetings, mediation, and rejected final offers, the parties reach a genuine impasse. The next day, Prairie Forge temporarily closes the plant for 10 days and tells employees the shutdown is solely to pressure the union to accept the company's last economic proposal; there is no evidence of antiunion hostility or refusal to bargain.

Has Prairie Forge most likely committed an unfair labor practice under NLRA §§ 8(a)(1) or 8(a)(3)?

Explanation. The majority held that an employer violates neither § 8(a)(1) nor § 8(a)(3) when, after bargaining impasse, it temporarily shuts down and lays off employees for the sole purpose of bringing economic pressure to bear in support of a legitimate bargaining position. The lockout does not, without more, unlawfully interfere with collective bargaining or the right to strike, and § 8(a)(3) is not violated absent a proscribed antiunion purpose.