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UNITED OFFICE & PROFESSIONAL WORKERS v. SMILEY

April 21, 1948

UNITED OFFICE AND PROFESSIONAL WORKERS of AMERICA
v.
SMILEY et al.



The opinion of the court was delivered by: MURPHY

Defendants, Pennsylvania Labor Relations Board (herein called State Board) and American Federation of Industrial and Ordinary Insurance Agents' Council (herein called Council) affiliated with the American Federation of Labor, move respectively to dismiss a complaint filed by United Office and Professional Workers of America (herein called United) affiliated with the Congress of Industrial Organizations. *fn1"

Upon petition filed by Council for certification of a representative for collective bargaining purposes of the Industrial Insurance Agents (herein called Agents) of the Prudential Insurance Company of America (herein called Prudential) working in Pennsylvania, the State Board found *fn2" a unit comprising Agents working exclusively in Pennsylvania and including agents whose debits were partly in Pennsylvania and partly in Maryland, constituted an appropriate unit and proceeded to determine the choice of representative. Whereupon United sought an injunction pendente lite and permanent restraining State Board and Council from proceeding with election and certification under State auspices, contending for application of the doctrine of supremacy and supersedure; and a declaratory judgment as to the exclusive rights of United as such representative for Prudential agents by virtue of Art. I, Section 8, and Art. VI, Cl. 2, United States Constitution, U.S.C.A. Constitution; the National Labor Relations Act (herein called the NLRA), 49 Stat. 449 et seq., 29 U.S.C.A. § 151 et seq., and certain proceedings by the National Labor Relations Board (herein called National Board), *fn3" and certain decisions of the United States Supreme Court.

 State Board and Council maintain this Court lacks jurisdiction in that plaintiff failed to aver the required jurisdictional amount in controversy; and that no cause of action is stated upon which relief can be granted. They contend for a right to continue unimpeded by any order of the United States District Court by virtue of the Pennsylvania Labor Relations Act (Act June 1, 1937, P.L. 1168 as amended) 43 P.S. § 211.1 et seq.; the X Amendment, United States Constitution, U.S.C.A. Constitution, and the Police Power of the State. They assert the jurisdiction of the National and State Boards is concurrent; that 'there can be no conflict between the Acts until they are applied to the same labor dispute' and even then not until the National Board actually assumes jurisdiction in the precise dispute and by a definitive order asserts its jurisdiction and thereby ousts the State Board; that the decision of the National Board, supra, 61 NLRB 1269, is of no avail even though it declared that a state-wide unit was not appropriate and on the contrary that the appropriate unit was a system-wide unit, arguing that because it referred to four other States and not to Pennsylvania it was not controlling; incidentally they argue that since the American Arbitration Association (herein called AAA), which conducted the card check to select a representative for Prudential's agents, was not a properly designated public body the selection of a representative was of no avail notwithstanding the recognition of such unit in the contract between United and Prudential and by the National Board did not decide the question presented to the State Board and its decision is therefore not controlling; that the United States Supreme Court has not decided State jurisdiction is ousted by the record presented. Finally defendants herein argue even if there is such ruling plaintiff must fail because of failure (a) to aver lack of adequate remedy at law; (b) to exhaust the remedies provided by Pennsylvania law, i.e., the administrative remedies before State Board, judicial review in Pennsylvania courts, and appeal to the United States Supreme Court; (c) to aver plaintiff suffered irreparable injury.

 On January 15, 1943, by a card check conducted by AAA, plaintiff was designated collective bargaining representative for Prudential agents 'throughout the United States,' *fn4" including Pennsylvania. February 1, 1943, plaintiff and Prudential executed a labor agreement covering the Agents in said unit and thereafter worked under similar agreements. *fn5" The current contract dated June 24, 1946, will expire October 1, 1948

 After the AAA designation and while the contract aforesaid was in effect, i.e., on November 27, 1944, and later Council and the International Union of Life Insurance Agents (herein called International), an unaffiliated labor organization, respectively filed petitions with the National Board seeking to carve out of the larger unit, state-wide units for the States of Illinois and Oklahoma, respectively, and for Indiana and Iowa, respectively. Petitioners contended that since plaintiff was not separately selected by agents in each of the states embraced in the comprehensive unit, the over-all unit was not appropriate. The National Board found this contention untenable *fn6" and that though the comprehensive unit was not nation-wide it approximated such unit and was as broad as the circumstances would permit. The National Board was not convinced that the units sought would promote more effective and stable labor relations than those already existing, citing as reasons therefore the history of collective bargaining, the highly centralized and integrated character of Prudential activities, the similarity of interests and working conditions throughout Prudential operations; and refused to disregard a pattern of collective bargaining which it found had created and maintained harmony between Prudential and its employees. The National Board found precisely 'the proposed state-wide units are inappropriate for the purposes of collective bargaining.'

 In the National Board proceedings, Council, United and Prudential were parties, Council contending for a state-wide unit, United and Prudential opposing. Prudential admitted its labor relations were subject to National Board jurisdiction.

 While the foregoing was pending before the National Board, Council on January 11, 1945, filed its petition with the State Board seeking a state-wide unit as to the Agents in Pennsylvania. Notwithstanding the National Board decision, the State Board on January 15, 1946, by divided opinion *fn7" concluded that a state-wide unit with appendages was appropriate and proceeded toward election and certification of a representative.

 We proceed seriatim to a discussion of the questions presented.

 The complaint asserts the action of State Board in proceeding, to conduct an election and certify an exclusive bargaining agent infringes the rights of United under the United States Constitution, the NLRA, and the National Board decision, and unless enjoined will cause irreparable damage to United. Since the NLRA is an act regulating commerce and no averment as to jurisdictional amount is required, *fn8" a proper case is presented for consideration in the Federal Courts. Section 24(8), Judicial Code, 28 U.S.C.A. § 41(8); Food, Tobacco, Agricultural and Allied Workers, etc., v. Smiley et al., 3 Cir., 1947, 164 F.2d 922; A.F. of L. v. Watson, 1946, 327 U.S. 582, 591, 66 S. Ct. 761, 90 L. Ed. 873; United Electrical, Radio & Mach. Workers v. International Brotherhood of Elec. Workers et al., 2 Cir., 1940, 115 F.2d 488, at page 490; Parker v. Brown, 1943, 317 U.S. 341, 349, 63 S. Ct. 307, 87 L. Ed. 315.

 In view of the findings of the National Board, 61 NLRB 1269; and Polish National Alliance v. N.L.R.B., 1944, 322 U.S. 643, 646, 64 S. Ct. 1196, 88 L. Ed. 1509, as to labor relations affecting interstate commerce; and United States v. South-Eastern Underwriters Ass'n et al., 1944, 322 U.S. 533, 64 S. Ct. 1162, 88 L. Ed. 1440, holding insurance per se to be interstate commerce where the company conducts a substantial part of its business transactions across state lines and that such business is subject to regulation under the commerce clause, there can be no doubt that the labor relations of Prudential here in question are subject to the jurisdiction of the National Board. *fn9" See supra, 322 U.S. 643, 646, 64 S. Ct. 1196, 1198, 88 L. Ed. 1509, 'that such are the substantial effects on interstate commerce of dislocating labor practices by insurance companies, was established before the Labor Board in at least thirteen comparable situations.

 We are here presented with a case where the State Board in proceeding on the theory that a state-wide unit with appendages is appropriate is in direct conflict with the decision of the National Board. *fn10" Both the National and State Boards would be thereby asserting jurisdiction and conflicting policies over Prudential's Agents in Pennsylvania. All of the cases have held that where this clash exists, under Art. VI, Cl. 2, of the United States Constitution, the doctrine of supersedure applies; the Federal ruling is paramount and must prevail

 In Bethlehem the State Board contended that though the National Board's power was paramount it was not exclusive, and that the State power may be exercised until the Federal power is actually exercised as to the particular employees. This contention was rejected. Said the Court, 330 U.S.at page 772, 67 S. Ct.at page 1029, 'Our question is primarily one of the construction to be put on the Federal Act.' Again, 330 U.S.at page 773, 67 S. Ct.at page 1030, ' * * * in Allen-Bardley Local v. Board, 315 U.S. 740, 62 S. Ct. 820, 86 L. Ed. 1154, where we held that employee and union conduct over which no direct or delegated federal power was exercised by the National Labor Relations Act is left open to regulation by the state. However, the power of the state may not so deal with matters left to its control as to stand 'as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.' Hill v. Florida, 325 U.S. 538, 542, 165 S. Ct. 1373, 1375, 89 L. Ed. 1782. Cf. Maurer v. Hamilton, 309 U.S. 598, 60 S. Ct. 726, 84 L. Ed. 969, 135 A.L.R. 1347.'

 Bethlehem held that New York was not permitted to use its police power because the failure of the National Labor Relations Board 'affirmatively to exercise their full authority takes on the character of a ruling that no such regulation is appropriate or approved pursuant to the ...


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