Appeal from National Labor Relations Board Petition for Review, Board Docket No. 22-CA-11527(E).
Seitz, Mansmann, Circuit Judges and Bissell, District Judge.*fn*
This case come before us on a petition by Local 825, International Union of Operating Engineers, to review a final order of the National Labor Relations Board, which dismissed an unfair labor practice complaint issued against Harter Equipment, Inc. We find that the Board property held that the company did not violate Sections 8(a)(1) or 8(a)(3), 29 U.S.C. § 158(a)(1) and (3), by hiring temporary employees after lawfully locking out its permanent employees for the sole purpose of applying economic pressure in support of a legitimate bargaining position. Accordingly, we will deny the union's petition for review.
Harter Equipment, Inc. ("Harter") is a New Jersey corporation engaged in the sale, distribution and service of construction and lawn maintenance equipment. Prior to 1978, Harter was a member of an employer association which was a party to a collective bargaining agreement with Local 825 ("the union"). In 1977, Harter withdrew from the association and entered into a separate collective bargaining agreement with the union, which ran from December 1, 1978 to December 1, 1981. The union represents a unit of the company's employees including parts and service department mechanics, "parts men," a truck driver a painter.
Negotiations to renew the contract began in October, 1981. From the beginning, the company made it clear that it needed substantial cost concessions because it was operating at a loss. The union's position throughout the negotiations was to extend the existing agreement for up to six months so that work might continue while negotiations progressed. Harter, however, wished to have a new contract executed by the December expiration date and would not permit it employees to work after that date without a contract.*fn1 The major issues separating the parties were wages and a union security clause.
On the day of the contract expired (December 1, 1981), the company submitted a "final" proposal providing, inter alia, for certain wage reductions and a union security clause. The union requested that the contract be extended one day to allow the employees to consider the proposal, and the employed did work on December 2. On December 3, the union rejected the proposal but indicated that the employees desired to continue working without a contract. Harter then refused to permit the employees to punch in or work. On December 4 the employees began picketing the company with signs stating they had been locked out.
Harter and the union continued to negotiate on the union security issue. However, after the withdrawal of proposals made by the union which had been accepted by the company, Harter decided to hire temporary replacements to complete service work already in the shop.
After temporary employees were hired, the parties continued to bargain but no final contract was consummated. The company continued to hire temporary replacements and the union continued to picket until April 1, 1982, when the unfair labor practice charge was filed by the union.
After a hearing, an Administrative Law Judge concluded that there had been no showing of anti-union animus, and that the company's lockout was instituted to bring economic pressure to bear upon the union. The ALJ reasoned that the lockout was neither inherently destructive of employee rights, inherently prejudicial to union interests, nor devoid of significant economic justification. The ALJ thus found that the use of replacements during the lockout was legitimate.
On appeal the National Labor Relations Board agreed with the ALJ. The Board held that absent specific proof of anti-union animus, an employer does not violate § 8(a)(3) by hiring temporary replacements in order to engage in business operations during an otherwise lawful lockout, including a lockout initiated for the sole purpose of bringing economic pressure ...