Pittsburgh Plate Glass Co. v. NLRB

Supreme Court of the United States · 1971 · Labor Law

Labor Lawcollective bargainingretiree benefitsmandatory subjects of bargainingunfair labor practicesNLRAretireespensioners

Facts

The union represented employees working on hourly rates at Pittsburgh Plate Glass's Barberton, Ohio facilities. Over time, the company and union negotiated health insurance arrangements that included retired employees, and in 1964 the company agreed to increase its monthly contribution for certain retirees, with a proviso tied to enactment of a national health program. After Medicare was enacted while the 1964 contract remained in effect, the company, without bargaining, announced plans to reclaim part of its contribution, cancel the retiree program, and substitute payment of supplemental Medicare premiums; later it instead offered retirees that supplemental coverage if they withdrew from the negotiated plan. The union objected and filed unfair labor practice charges after the company communicated directly with retirees and some accepted the offer.

Issue

Whether already retired employees' benefits are mandatory subjects of collective bargaining under the NLRA, either because retirees are employees within the bargaining unit or because retiree benefits vitally affect the terms and conditions of employment of active employees. Also, whether a unilateral mid-term modification involving retiree benefits violates § 8(d).

Rule

The employer's statutory duty to bargain extends only to the wages, hours, and other terms and conditions of employment of employees in the appropriate bargaining unit. Already retired workers are not employees within the meaning of the collective-bargaining obligations of the Act and are not members of the bargaining unit; their benefits are therefore not mandatory subjects of bargaining unless the matter vitally affects active employees' terms and conditions of employment, and speculative or insubstantial effects are not enough. Section 8(d)'s prohibition on unilateral mid-term modification applies only to mandatory subjects of bargaining, not permissive ones.

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

Lakefront Foundry, a fictional manufacturer in Toledo, Ohio, has a union representing hourly production workers. During negotiations for a successor contract, the union demands bargaining over increased vision benefits for workers who retired five years ago and have performed no work since retiring, with no expectation of returning.

If Lakefront Foundry refuses to bargain over those retiree vision benefits, which is the best answer?

Explanation. The majority held that the duty to bargain extends only to wages, hours, and other terms and conditions of employment of employees in the appropriate bargaining unit. Persons who have retired, ceased work, and lack any expectation of further employment are not employees for this purpose. Their benefits may be bargained over permissively, but the employer is not statutorily required to bargain over them absent a vital effect on active employees.