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National Labor Relations Board v. Acme Industrial Co.

Supreme Court of United States
385 U.S. 432 (1967)
ELI5:

Rule of Law:

The National Labor Relations Board (NLRB) has the authority to order an employer to furnish information relevant to a union's processing of a grievance, and this authority is not foreclosed by the existence of a binding arbitration clause in a collective bargaining agreement. An employer's statutory duty to bargain in good faith includes the obligation to provide information necessary for a union to intelligently evaluate and process grievances.


Facts:

  • In April 1963, Acme Industrial Co. and its employees' union entered into a collective bargaining agreement.
  • The agreement contained a clause restricting the company's ability to subcontract work if it would cause layoffs.
  • A separate clause provided employees with transfer rights if the company moved equipment to another one of its locations.
  • The agreement also established a multi-step grievance procedure that culminated in compulsory and binding arbitration.
  • In January 1964, the union observed that certain machinery was being removed from the company's plant.
  • Union representatives asked company foremen about the equipment removal, but the foremen refused to answer.
  • The union filed grievances alleging violations of the subcontracting and equipment transfer clauses and sent a letter to the company formally requesting specific details about the removed machinery.
  • The company refused to provide the requested information, asserting it had no duty to do so because no layoffs had occurred within the contract's five-day time limit for filing grievances.

Procedural Posture:

  • The union filed unfair labor practice charges against Acme Industrial Co. with the National Labor Relations Board (NLRB).
  • The NLRB issued a complaint, and after a hearing, it overruled its trial examiner and found the company had violated § 8(a)(5) of the NLRA.
  • The NLRB issued a cease-and-desist order requiring the company to furnish the requested information.
  • The U.S. Court of Appeals for the Seventh Circuit refused to enforce the Board's order, holding that the Board's jurisdiction was foreclosed by the arbitration clause in the collective bargaining agreement.
  • The U.S. Supreme Court granted certiorari to resolve the issue.

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Issue:

Does the existence of a binding arbitration clause in a collective bargaining agreement prevent the National Labor Relations Board from ordering an employer to furnish information requested by a union to evaluate a potential grievance?


Opinions:

Majority - Mr. Justice Stewart

No. The existence of a binding arbitration clause does not prevent the National Labor Relations Board (NLRB) from ordering an employer to provide a union with information relevant to a grievance. An employer's duty to bargain in good faith under § 8(a)(5) of the National Labor Relations Act includes providing information needed by the bargaining representative to perform its duties, and this duty extends to the processing of grievances. The Board's power to remedy unfair labor practices is statutory and, under § 10(a) of the Act, is not affected by other means of adjustment like arbitration. The Board's order was not a binding interpretation of the contract's merits but rather a 'discovery-type' determination that the information was probably relevant to the union's duties. This action aids the arbitral process by allowing the union to sift out unmeritorious claims before arbitration, thus preventing the system from being overburdened.



Analysis:

This decision clarifies the relationship between the NLRB's statutory authority and private arbitration agreements, establishing that the Board's role in enforcing the duty to bargain is complementary, not subordinate, to arbitration. It empowers unions to conduct pre-grievance discovery, strengthening their ability to police collective bargaining agreements effectively. By affirming the Board's power to compel information disclosure, the Court ensures that arbitration clauses cannot be used by employers as a shield to conceal information, thereby promoting a more efficient and fair grievance process where claims can be evaluated on their merits before incurring the costs of arbitration.

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