NATIONAL LABOR RELATIONS BOARD v. GENERAL ELECTRIC COMPANY
418 F.2d 736 (1969)
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Rule of Law:
An employer violates its duty to bargain in good faith under § 8(a)(5) of the National Labor Relations Act when it combines a 'take-it-or-leave-it' bargaining posture with a widespread publicity campaign that locks the employer into its initial offer and derogates the union's role as the employees' representative.
Facts:
- Following a damaging strike in 1946, General Electric (GE) developed a new labor relations strategy known as 'Boulwareism.'
- This strategy involved researching employee desires, formulating a single 'firm, fair offer' based on that research, and then 'selling' this offer directly to employees and the public through a massive communications campaign, portraying the offer as final and non-negotiable.
- In June 1960, prior to the start of formal negotiations for a new contract, GE announced it would unilaterally implement a new personal accident insurance plan on a take-it-or-leave-it basis.
- During formal negotiations in August 1960, GE presented its comprehensive 'firm, fair offer' and, despite the union's (IUE) request to delay, immediately launched its extensive publicity campaign to employees.
- Throughout the negotiation meetings, GE negotiators consistently refused the IUE's requests for cost data related to various proposals, often stating 'we talk level of benefits, not costs.'
- When the IUE proposed reallocating funds within the cost framework of GE's offer for a different benefit, a GE negotiator rejected it, stating that after telling employees 'this is it, we would look ridiculous to change it at this late date.'
- During a strike that followed the breakdown of negotiations, GE bypassed the IUE's national negotiators and made separate settlement offers directly to several local unions.
Procedural Posture:
- The International Union of Electrical, Radio and Machine Workers (IUE) filed unfair labor practice charges against General Electric (GE) with the National Labor Relations Board (NLRB).
- The NLRB's General Counsel issued a complaint alleging GE violated the National Labor Relations Act.
- An NLRB Trial Examiner conducted hearings and issued a report finding GE guilty of several unfair labor practices.
- The full National Labor Relations Board affirmed the Trial Examiner's findings and issued an order against GE.
- GE filed a petition to review the NLRB's order in the U.S. Court of Appeals for the Seventh Circuit, while the IUE filed a similar petition in the D.C. Circuit.
- After resolving jurisdictional issues, the competing petitions were consolidated in the U.S. Court of Appeals for the Second Circuit, along with the NLRB's cross-petition for enforcement of its order.
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Issue:
Does an employer violate its duty to bargain in good faith under § 8(a)(5) of the National Labor Relations Act by combining a 'take-it-or-leave-it' bargaining posture with a widespread publicity campaign that locks the employer into its initial offer and derogates the union's role as the employees' representative?
Opinions:
Majority - Irving R. Kaufman
Yes. An employer violates its duty to bargain in good faith when its overall conduct, including a 'take-it-or-leave-it' offer combined with a pervasive communications campaign, demonstrates that it is not engaged in a genuine effort to reach a mutual accommodation. The 'totality of the circumstances' here indicates GE engaged in bad faith bargaining. GE's strategy, known as 'Boulwareism,' involved presenting a 'firm, fair offer' and then using a massive publicity campaign to sell it directly to employees, effectively bypassing and undermining the union. This tactic 'painted [the company] into a corner,' making it impossible to compromise at the bargaining table without losing credibility with its employees, thus constituting a refusal to bargain 'in fact.' This overall bad faith was compounded by specific unfair labor practices, including unilaterally proposing an insurance plan, refusing to furnish relevant cost information necessary for bargaining, and bargaining directly with local unions during a strike to subvert the national representative. GE's communications were not protected by § 8(c) of the NLRA because they were not isolated expressions of opinion but were integral parts of a course of conduct designed to subvert the collective bargaining process.
Concurring - Waterman
Yes. The key element that rendered GE's conduct unlawful was not the 'firm, fair offer' itself, but its 'widely publicized stance of unbending firmness.' While a company may stand by its offer, it may not advertise 'firmness for the sake of firmness.' Such publicity creates two evils: first, it makes it nearly impossible for the company to alter its position without damaging its pride and reputation; second, it conveys to employees that the company is their true representative and that the union is superfluous. This publicity amplifies the negative tendencies of a firm offer to the point where it can be construed as evidence of a motive not to bargain in good faith.
Concurring-in-part-and-dissenting-in-part - Friendly
No. The finding of an overall failure to bargain in good faith should be rejected, though GE did commit specific violations. I concur that GE violated the Act by refusing to furnish cost information and by bargaining directly with locals. However, I dissent from the holding that GE's overall conduct and its 'Boulwareism' strategy constituted bad faith bargaining. The NLRA, particularly § 8(d), does not compel either party to make a concession or agree to a proposal. As long as GE had a desire to reach an agreement—which it did—its hard bargaining tactics are permissible. The majority's holding improperly uses GE's communications campaign, which is protected speech under § 8(c), as evidence of bad faith. This decision intrudes into areas Congress left to the parties and 'contains the seeds of danger for unions' as well as employers by allowing the NLRB to judge bargaining techniques and attitudes.
Analysis:
This landmark decision established that an employer's 'totality of conduct' can amount to bad faith bargaining, even if the employer is willing to sign a contract. The court effectively outlawed the 'Boulwareism' strategy by holding that an employer cannot combine a rigid take-it-or-leave-it offer with a communications campaign that locks it into that position and undermines the union's authority. The case clarified that § 8(c) free speech rights are not absolute and do not shield communications that are part of an overall pattern of illegal conduct. This ruling expanded the concept of good faith bargaining from a procedural requirement to meet and confer into a more substantive evaluation of a party's state of mind and its willingness to engage in the give-and-take of genuine negotiations.
