Laidlaw Corp. v. NLRB

United States Court of Appeals for the Seventh Circuit · 1969 · Labor Law

414 F.2d 99 (1969)

Updated August 1, 2026

Labor Lawrecall rights of strikerseconomic strikersreinstatementpermanent replacementscontinuing applicationFleetwoodMackay

Facts

After an economic strike began, Laidlaw told employees that if they struck and were replaced they would lose forever their right to employment, and it hired permanent replacements. When strikers later made unconditional offers to return, Laidlaw reinstated only those for whom vacancies existed on the exact day of application and treated the rest as terminated, even though vacancies later arose when replacements departed. The company then filled later openings with new hires rather than the earlier striker-applicants, and it required striker Massey to return only as a new employee without accrued seniority and vacation rights. The Board also found Laidlaw maintained an overly broad rule banning circulation of printed matter on company premises.

Issue

Whether economic strikers who unconditionally apply for reinstatement at a time when their jobs are occupied by permanent replacements retain employee status and must be offered reinstatement as vacancies later arise. Also, whether Laidlaw violated the Act by threatening employees that striking and replacement would forever destroy their employment rights and by maintaining an invalid no-distribution rule.

Rule

An economic striker who unconditionally applies for reinstatement while his position is filled by a permanent replacement remains an employee and is entitled to reinstatement when a job for which he is qualified becomes available, unless the employer shows a legitimate and substantial business justification for refusal or the striker has obtained other regular and substantially equivalent employment. The right to reinstatement does not expire merely because no vacancy exists at the moment of application, and the employer may not ignore outstanding applications and hire new employees instead. An employer also may not condition reinstatement on loss of accrued seniority and vacation rights.

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Workers at Riverbend Paper Products in Peoria, Illinois, began an economic strike after wage talks stalled. Two weeks later, several strikers sent unconditional letters asking to return to work, but their positions were then occupied by permanent replacements; ten days after that, three replacements quit and the company filled those openings with outside applicants already on file.

If the strikers file an unfair labor practice charge, what is the strongest argument that the employer violated the Act?

Explanation. An economic striker who unconditionally applies for reinstatement while his position is occupied by a permanent replacement remains an employee and is entitled to reinstatement when a suitable vacancy later arises, unless the employer shows a legitimate and substantial business justification or the striker has obtained other regular and substantially equivalent employment. The employer may wait to avoid discharging permanent replacements, but may not ignore outstanding striker applications and hire new outsiders when later vacancies occur. (Derived from Laidlaw Corp. v. NLRB (1969).)