Union Legal Action Against Company Ruled Illegal by NLRB

The Nat. Labor Relations Board Jul. 19 ordered the Int’l Ass’n of Bridge, Structural & Ornamental Iron Workers to discontinue efforts to enforce a contract provision requiring all entities — union and nonunion — owned or financially controlled by Elwin G. Smith, Inc., to follow the union contract. The Iron Workers’ effort to obtain summary judgment in U.S. Dist. Court to enforce its anti-dual shop provision in its agreement with the company violates Nat. Labor Relations Act Section 8(e), NLRB decided in modifying an administrative law judge’s decision.

Prior to the last restructuring of the company, the union in 1986 began to complain about a Smith subsidiary subcontracting work to Southwestern Materials & Supply, Inc., a non-union builder, and demanded arbitration. The union filed a petition to compel arbitration and a complaint for damages on Sep. 2, 1986, in the U.S. Dist. Court for the W.Dist. of Pa. The petition sought to require two Smith components and Southwestern to arbitrate applicability of the anti-dual shop to Southwestern’s construction work. The union filed a motion for summary judgment on Jan. 14, 1988, reasserting its position that the employers were obligated to arbitrate applicability of the provision. The court has stayed ruling on the petition and complaint pending completion of the board’s proceeding.

Addressing the merits of the case, NLRB said anti-dual shop provision requires contract application to work under the union’s jurisdiction that is performed by Smith or an entity owned or controlled by Smith. This clause requires that the contract be extended to affiliated entities, including those over which Smith does not control assignment of work. The fact that the signatory employer owns another business does not necessarily mean the signatory employer has control over assignment of work in that other entity, according to NLRB. “Thus, the clause is not limited to addressing the labor relations of the contracting employer vis-a-vis its own employees, but instead seeks to regulate the labor policies of other, neutral employers — an objective that is clearly secondary,” NLRB said. [BNA 8/10/99]