Boich Mining Company v. National Labor Relations Board
955 F.2d 431 (1992)
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Rule of Law:
Two companies do not lose their status as separate entities for the purposes of secondary boycott provisions, even if under common ownership, when they maintain separate management, have independent control over their own labor relations, and their operational interrelationship consists only of minor, arm's-length business transactions.
Facts:
- Boich Mining Company (Boich) and Aloe Coal Company (Aloe) are both wholly-owned subsidiaries of Aloe Holding Company.
- Boich operates a surface coal mine in Ohio, while Aloe operates a surface coal mine in Pennsylvania, approximately 31 miles away.
- The United Mine Workers (UMW) represents the production and maintenance employees at both companies.
- In 1988, Boich and its UMW employees entered into a collective bargaining agreement that remains in effect.
- On July 11, 1989, Aloe's employees went on strike after failing to agree on a new collective bargaining agreement with Aloe.
- Boich and Aloe operate with separate management, presidents, offices, payroll systems, bank accounts, and financial operations, with no interchange of employees or supervisors.
- Boich regularly sends approximately 8% of its total coal output to Aloe's facility to be washed and blended with 5-6% of Aloe's output, creating a new product which the companies share proportionately.
Procedural Posture:
- On August 3, 1989, the UMW called upon the employees of Boich to strike in support of the striking workers at Aloe.
- On August 4, 1989, Boich filed an unfair labor practice charge against the UMW with the National Labor Relations Board (NLRB), alleging a violation of the Act's secondary boycott provisions.
- An Administrative Law Judge (ALJ) conducted a hearing and issued a decision finding Boich and Aloe to be allied employers, dismissing Boich's complaint.
- The NLRB affirmed the ALJ's findings and dismissal of the complaint.
- Boich (Appellant) petitioned the U.S. Court of Appeals for the Sixth Circuit for review of the decision of the NLRB (Appellee).
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Issue:
Are two companies, wholly owned by the same parent, considered 'allies' under the National Labor Relations Act, thus permitting a primary strike against one to be lawfully extended to the other, when they maintain separate management and labor relations but engage in a minor, arm's-length business transaction?
Opinions:
Majority - Timbers, Senior Circuit Judge
No. Two companies wholly owned by the same parent are not considered 'allies' under the National Labor Relations Act when they maintain separate management and labor relations and their only operational link is a minor, arm's-length business transaction. The court applied the four-factor test for determining if two employers are a single entity: (1) common ownership, (2) common management, (3) centralized control of labor relations, and (4) interrelationship of operations. While acknowledging common ownership, the court held this factor is not dispositive, especially where management operations are intentionally kept separate. The court found that Boich and Aloe had entirely separate management, financial operations, and, most importantly, control over day-to-day labor relations. The Board had incorrectly found the companies were allied based on their coal washing and blending process. The court characterized this as a minor, 'typical arms-length business transaction' insufficient to overcome the overwhelming evidence of separateness. Therefore, the Board’s finding was not supported by substantial evidence, and Boich was a neutral employer protected from the secondary boycott.
Analysis:
This decision refines the application of the 'ally doctrine' to corporate affiliates, making it more difficult to strip a company of its neutral status in a labor dispute. The court prioritizes the factors of separate management and decentralized control of labor relations over the factor of common ownership. The ruling establishes that minor, arm's-length commercial dealings between sister corporations are insufficient to prove they function as a single entity. This precedent requires unions to demonstrate a high degree of actual, day-to-day integration and centralized control over labor policy to justify extending a primary strike to a secondary employer.
