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99. CASE: THE GIVE BACK: A CASE OF UNION BUSTING
I. OVERVIEW
Three years ago, Local 974 of the United Tireworkers of America made signi,cant contract
concessions to the North American Tire plant in Bailey, Georgia. The union concessions were made for
the company’s economic survival and for the plant to remain open. Now, as the U.S. economy was
struggling to recover from what some had called the worst recession since the Great Depression, North
American Tire and its union was back at the bargaining table. While the U.S. economy had shown some
signs of recovery, the union was not looking to give back again but to recover some of what was given up
in previous negotiation. The union’s position was that its previous concessions had facilitated North
American Tire’s survival and that it had already done its part to ensure the company’s viability. However,
the company had other goals for negotiation.
II. OBJECTIVES
Possible learning outcomes for students include:
1. Introduce the students to legal issues associated with continuing operation while
the employees are engaged in a strike.
2. Introduce the students to the collec3ve bargaining process.
3. Instructors may also use this exercise as an opportunity to introduce students to the
Employee Free Choice Act, which if passed as currently written would drama3cally
alter the Union Representation election Process and initial bargaining over the terms
and condition of the ,rst contract.
III. DISCUSSION
The case presents a situation involving a labor/management impasse that has resulted in a
strike. The union is looking to recoup concessions made in the previous contract when the company
appeared to be in ,nancial trouble. Pro,ts are now up, and the union expects to recover what the
workers gave back in the previous nego3a3on. Management, on the other hand, is still faced with a
very compe33ve worldwide industry with many competitor constantly looking to cut labor cost.
The decision by management to continue operation during the strike is the focal point of the
case. Under US labor law, the use of strike replacements during an economic strike is legal. The strikers
have only limited reinstatement rights to their jobs. If the national Labor relation Board (NLRB)
determines unfair labor practice allega3ons of bad faith bargaining are valid, then the strike would be
classi,ed as an unfair labor practice strike. Striking workers would have full reinstatement rights to their
jobs. Strike replacement workers would have to be terminated.
IV. ANSWERS TO INCIDENT QUESTIONS:
1. What are the pros and cons of the ,rm's strategy of hiring replacement workers?
The strategy is legal as long as the ,rm continues to negotiate with the union. Economic strikers
may be permanently replaced under current labor law. continuing operation during a strike certainly
On the nega3ve side, the public relation fallout could be a problem for the company. If the
union is able to mount an eCec3ve public relation campaign, consumers may boyco: the ,rm. Due to
nega3ve publicity, the company will lose the advantage gained by continuing to produce. potential
2. Assume that the ,rm's goal is to break the union, what are the advantages and
disadvantages of this strategy?
The strategy at this point is legal as long as the ,rm continues to negotiate in good faith with the
3. What standard should the ,rm use in seEng wage rates? (Industry or geographic)
Answering this question depends on your perspec3ve. From management's point of view,
whichever standard will enhance your compe33ve position would take precedent. The union, on the
The teaching note was prepared by Gerald E. Calvasina, Professor of Management, Southern Utah
University and Joyce M. Beggs, Associate Professor, University of North Carolina at Charlo%e.
100. EXERCISE: APPLYING THE NLRA
Responses to situation
1. The national Labor relation Act speci,es and, national Labor relation Board (NLRB)
interpreta3on has held that it is the employee's role to initiate a decer3,ca3on pe33on. In
the situation described, the supervisor can advise the employees to contact the NLRB
regional oKce to ,nd out how to initiate proceedings to decer3fy the union.
2. This is known as union "sal3ng". It is a recent union organizing tactic in which professional
union organizers apply for employment with open shop employers while openly expressing
an intent to organize the companies' employees. Recent court decisions and the NLRB have
held that employers cannot refuse to hire paid professional union organizers as employees
solely because of their union status. Remember, it is an unfair labor practice to refuse to
hire a bona ,de employee applicant because of union sympathies, membership, or
association. It is also not advisable to ask questions designed to discover union aKlia3ons.
This type of questioning can be used to establish an intent to discriminate.
3. Currently, the NLRA permits employers to permanently replace economic strikers. President
Clinton issued an executive order in March of 1995, which forbids government contractors
from doing this, and congress and employers continue eCorts to secure this option for
employers. This order was struck down by D.C Circuit Court of Appeals in 1996 in Chamber
of Commerce of the United State4s v. Reich, 74 F. 3d 1322 (1996).
4. This is known as an "Excelsior list", based on the 1966 NLRB case Excelsior Underwear, Inc.,
156NLRB No. 111. Within 7 days aDer the Regional Director has approved a consent-election
agreement or the Regional Director or the NLRB in Washington has ordered an election, the
employer must ,le with the Regional Director an election eligibility list, containing the
names and addresses of all the eligible voters.
5. There is potential here for several blatant unfair labor practice charges against the employer.
The only consola3on for you as a manager is, if your employer terminates you for refusing to
follow up on the orders, you may now be protected under the NLRA and may also ,le an
unfair labor practice charge against your "former" employer. It may even be possible to
advance a wrongful discharge claim in a state court under the public policy exception to the
at-will doctrine.
Gerald E. Calvasina, Associate Professor, Southern Utah University prepared this teaching note.
101. EXERCISE: LABOR ARBITRATION
I. objective
A. To familiarize you with the arbitration process.
B. To give you practice in presen3ng a case before others.
C. To examine issues relating to contract administration.
II. Out-of-Class preparation Time: 40–50 minutes
III. Procedures
Either at the beginning of or before class, each student should read the exercise. To start the
exercise, the instructor will divide the class into the following three groups:
A. Union representative (approximately ,ve individuals)
B. Company representative (approximately ,ve individuals)
C. Arbitrators (all remaining participant, divided into groups of three to ,ve members)
The union representative should meet together and carefully examine “The Union position” and
prepare to argue and defend this position. The company representative should do the same with
reference to “The Company position.” Meanwhile, the arbitrators should read both the union position
and the company position and discuss among themselves the arguments for and against each position.
ADer both the union and company representative have prepared their position statements, each
should present their case to the arbitrators. Each group will be allowed ,ve minutes for their
presentation, and then an additional ,ve minutes to counter the other group’s position.
ADer all presentations are complete, each group of arbitrators will be given 10 minutes to discuss the
case and reach a decision. These decisions should be presented, along with the reasoning behind them,
to all participant.
Finally, the instructor may (optionally) present the arbitrator’s actual decision in this case.
The Issue
Was the grievant discharged for just cause? The company claimed the employee’s negligence of duty
resulted in the discharge and the union claimed poor performance was the issue. If the union is right,
what should be the remedy?
Per3nent Provisions of the Union Agreement
article I. Purpose of the Agreement.
1.3. The management of the company and the direction of the working force, including the right to plan,
direct, and control operation, the right to hire, suspend, transfer, or discharge for just and suKcient
cause, to relieve employees from duties because of lack of work or for other legitimate business reasons,
and the right to introduce new or improved methods or facilities of production is vested exclusively in
the company; provided, however, that such rights shall not be exercised for the purpose of
discrimina3ng against any employee, and such rights shall not conTict with the provisions of this
agreement.
article 33. Discipline and Discharge
33.1. In cases of poor job performance, the following procedure dealing with discipline will be
accomplished with written no3,ca3on to the Union:
a. Formal written warning in the ,rst instance with copy to the employee.
b. In subsequent instances, formal written warning and/or suspension without pay for a period not
to exceed ,ve working days.
c. In the event three or more instances occur, one of which results in a suspension, within any
two-year period, discharge for just cause will be accomplished.
33.1.1. For purposes of this article, job performance shall include consideration of the following
factors:
a. A:endance record, including absenteeism, tardiness, and proven abuse of sick leave.
b. Adherence to industrial safety rules.
c. Adherence to Company house rules.
d. Ability to perform assigned tasks sa3sfactorily.
33.2. In cases of personal misconduct, the disciplinary action taken, including discharge, will be
consistent with the gravity of the oCense.
Background
The grievant was employed as a service technician for the ABC Petroleum/Gas Company from
August 1999 to April 2003. On January 26, 2003, grievant was dispatched to a customer who reported a
strong odor. Grievant’s service report showed that he spent 26 minutes on the call, that no leaks were
found, and that no repairs were made. The grievant did not take a pressure/manometer test.
Later that same day, in response to a second call, another technician was sent to the customer’s
home. The second technician checked the gas tank and gauge readings, added some gas, used the track,
and did the pressure/manometer test. He tested the lines and isolated the source of the gas odor at a
leak in the heater connector aDer the shutoC valve on the heater. The leak was located less than two
feet from the pilot light on the water heater, which was lit. The technician replaced the heater connector
and put the old one in the back of his truck. Subsequently, the grievant’s immediate supervisor talked
with the second technician and examined the damaged heater connector. On January 28, 2003, the
supervisor met with the grievant and informed him that he was being suspended, pending an
investigation. The reason for the suspension was “Negligent in responding to report of gas odor on
January 26, failure to perform leak investigation according to company procedures, leaving party with
hazardous condi3on.” By letter on April 16, 2003, grievant was no3,ed that he was being terminated
based on the company’s ,ndings indicating that “the incident was of such serious nature that we would
be remiss in continuing your employment as a technician.”
The Company’s position
The company contends that the grievant failed to follow normal procedures necessary to determine
whether there was a gas leak, and that leaving the customer in a hazardous condi3on cons3tuted just
cause for discharge. The grievant’s failure to ,nd or repair the gas leak was not poor performance but
negligence of duty. The company de,ned poor performance as involving a lack of skills or intelligence
and that the grievant’s behavior was not caused by a lack of skills or innate inability. The company
speci,cally refers to article 1.3 which permits the company to discharge an employee for “just cause”
and that, under article 1.3, no prior warnings are required. The company also noted in its presentation
that the employee was previously suspended for ,ve days in 2000, and that he has been reprimanded on
numerous occasions for various infractions.
The Union’s position
The union contends that the grievant should have been disciplined under section 33.1 for poor job
performance. The union contends that grievant performed three of the four tests usually performed and
that, at worst, used poor judgment in not pressure tes3ng the system. Further, the union contends that
the company failed to give grievant adequate notice of the rule or the consequences of his action. The
grievant did not have knowledge that he could be discharged for negligence in performance of his duties.
Further, the union claimed that the company did not conduct a proper investigation and relied solely on
the report of the second technician sent to the customer’s home. The company made no a:empt to visit
the job site to determine ,rsthand if grievant had followed company rules.
102. SKILL BUILDER: EMPLOYEE COMMUNICATIONS DURING UNION CAMPAIGNS
I. OBJECTIVES
1. To give students practice in preparing an eCec3ve company communication during a
union campaign.
2. To help students understand the practical application of the national Labor relation
Act.
3. Instructors may also use this exercise as an opportunity to introduce students to the
Employee Free Choice Act, which if passed as currently written would drama3cally
alter the Union Representation election Process.
II. TIME REQUIRED TO COMPLETE: 1 hour
III. INSTRUCTIONS: See Text
In order to do an eCec3ve job on this assignment, students will need to review sections 7 and 8
of the national Labor relation Act. section 8 (a)(1) of the act states that employers cannot interfere
with, restrain, or coerce employees in exercising their rights under section 7 to join or not to join a labor
organization. Viola3on of the act usually involves threatening employees with the loss of jobs, pay, or
bene,ts; interroga3ng employees about their union ac3vi3es or interest in the union; surveillance of
employees' union ac3vi3es; or promising increases in wages and bene,ts in exchange for non-union
votes. These principles can be applied to specifying permissible content in letters sent to employees. If
any of these general principles are violated the employer may be guilty of an unfair labor practice.
letter to employees must be carefully draDed since employees would have de,nite evidence of unfair
labor practices if the content of the letter contains viola3ons of section 8 (a) (1). It is important to point
out to students that the interpreta3on of section 8 (a) (1) is largely determined by the outcomes of NLRB
cases. While section 8 (a) (1) does protect employer expression of "views, argument or opinion," the
diCerence between protected statements and unprotected threats" or "promises” must take account of
the way in which the language is likely to be understood by employees (See NLRB vs. Gissel Packing C o.,
395 U. S. 575 (1969). In Midland national Life Insurance Co., 263 NLRB No. 24 (1982), aDer a number of
changes in its position, the Board has now taken the position that factual misrepresentations in speeches
or statements do not disturb the "laboratory condition" deemed necessary for holding fair elections.
This assignment works well if you allow students to cri3que each other’s letters. This can be achieved by
having students exchange letters with one another or the instructor can select one or more students to
read their letter to the class. It may be useful to discuss eCec3ve management strategies during union
organizing campaigns.
Sample Le:er
Dear Fruit Canner Employee:
We feel that it is important that we share with you our philosophy about labor unions and what
aCect they might have on our company. Our approach has always been working directly with employees
to resolve any problems or issues. A union will only interfere with a relationhip that has taken us many
years to build.
While you have the legal right to join a union, you also have the legal right not to join a union.
We feel very strongly that we do not need a union here at Fruit Canners because we don't think the
United Food and Commercial Workers Union can oCer many advantages to you.
We feel that it is only fair that you understand the changes a union will bring to the workplace.
Unions may require you to pay an ini3a3on fee. Some unions have charged their members as much as
$800 to join. additionally, you may also be required to pay monthly union dues. Worse yet your union
may engage in strikes and boyco:s disrup3ng normal business. Employees will no longer be able to
come directly to management to discuss problems but will have to follow union procedures and policies.
We do not feel that we need a third party to come between us.
We do hope that you will think very carefully about the United Food and Commercial Workers
Union. Unions can promise a lot, but we hope that you will not sign a union authoriza3on card if asked.
Sincerely,
Contributed by Dr. Gerald Calvasina, Southern Utah University.
