NLRB v. Truitt Manufacturing Co.

Supreme Court of the United States · 1956 · Labor Law

351 U.S. 149 (1956)

Updated August 1, 2026

Labor Lawduty to discloseinability to payNLRAgood-faith bargainingSection 8(a)(5)collective bargainingfinancial disclosure

Facts

During wage negotiations, the union sought a 10-cent-per-hour wage increase for certain employees of respondent. The company replied that it could not afford such an increase, said it was undercapitalized, had never paid dividends, and claimed that an increase of more than 2 1/2 cents per hour would put it out of business. The union repeatedly requested financial information or access to records to substantiate those assertions, including review by a certified public accountant and full information about the company's financial standing and profits. The company refused all such requests, stating that the information was not pertinent and that the union had no legal right to it.

Issue

May the NLRB find that an employer failed to bargain in good faith when the employer asserts that it cannot afford higher wages but refuses requests to provide information substantiating that claim? More specifically, may refusal to attempt to substantiate an asserted inability to pay support a finding of an unfair labor practice under Section 8(a)(5)?

Rule

In determining whether the statutory duty of good-faith bargaining has been met, the Board may consider an employer's refusal to provide information about its financial status when the employer relies on an asserted inability to pay increased wages. A refusal to attempt to substantiate such a claim may support a finding of failure to bargain in good faith, but entitlement to substantiating evidence does not arise automatically in every case; each case turns on its particular facts and circumstances.

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

In Toledo, Ohio, Lakeview Toolworks is negotiating a new contract with a union representing machinists. Management repeatedly says it cannot afford any wage increase because a larger raise would force layoffs, but when the union asks for payroll and profit summaries or any other support for that claim, management says only that its finances are private and provides nothing.

If the Board later evaluates whether Lakeview bargained in good faith, which is the best answer?

Explanation. When an employer relies in bargaining on an asserted inability to pay higher wages, the Board may consider the employer’s refusal to provide some substantiation of that claim in deciding whether the employer bargained in good faith. The rule is not automatic, but a flat refusal to make the slightest effort to support the claim can support an inference of bad faith.