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Labor Law
St. Johns University School of Law
Fernbach, Karen P.

Professor Fernbach
A.     The Labor Problem and the Law
·         Events were unfolding to undermine independence of skilled craftsmen
o   Division of labor, driven by machinery, decreased need for craft skills
o   Factory system led to grown in scale of manufacturing enterprises
o   Change in composition of working force. Managerial, supervisory and highly skilled craft workers were native-born, male and protestant. Lower level EEs were immigrants
·         Three Attributes of Wealth: Land, Labor, Capital
·         Corporations have collectivized power and wealth for a long time
·         Until relatively recently, judicial decisions were unfavorable to labor. Unions were seen as criminal conspiracies designed to deprive the Employer of its property or to interfere with its contracts
·         Employees began gathering together to try to improve their terms of employment. Employers reacted by seeking injunctions.
B.     The Rise of the Labor Movement
·         Tremendous economic growth following the Civil War
·         First national Craft Unions founded in 1850s – skilled laborers
·         1869 – Knights of Labor – started as a small group in PA that grew into a strong national organization. Died out due to lack of leadership, internal divisions, high membership turnover
·         1886 – American Federation of Labor – Samuel Gompers; relied on economic power and concentrated on short run objectives, steered clear of political entanglements – “plain and simple unionism” – AFL agreements treated wages, hours and job security as most important
·         Industrial Workers of the World (IWW) – wanted an 8 hour day
·         Some ERs instituted welfare plans – health care, recreational facilities, bonuses, profit sharing, etc. to reduce labor turnover and tie workforce more closely to firm
C.     The Union
·         Unions Goal:  to achieve Employer recognition and work towards certification
·         Unionization is an effort to achieve objectives, between a worker and his job, that facilitate participation in the shaping of the rules that govern the workplace.
·         Sources of Unionization: spontaneous internal initiative; professional solicitation of discontent workers
Pros of Unions:
1.      Job Security- unless you are in a protected class, you are at-will.
2.      If you are in a union, your employer must have just-cause to fire you.
3.      In a group you can collectively bargain
1.      Labor Injunction in Private Disputes
·         After 1900, the courts began to use injunctions and the antitrust laws to curb concentrated union activities (Strikes and boycotts) à there were generally swift, and generally violated Due Process
·         Vegelahn v. Gunter 1896 [best known labor injunction case] o   Facts: Employees picketed to get better wages and patrolled area to prevent employer from getting new employees. Weren’t blocking access, just talking to people.
o   Issue: Were employees allowed to do this picketing?
o   Holding: Picketing interferes with ER’s right to do business and with the rights of existing and prospective EEs. Strikers’ motive for better wages didn’t justify the patrol. It was prohibited conduct
o   Picketing is intrinsically intimidating and coercive, and thus enjoinable  – didn’t matter that they weren’t violent. Union must pursue lawful ends by lawful means
o   Holmes’ Dissent: injunction goes too far, EEs should be able to use social tactics not accompanied by violence. He said a temporary injunction was overkill
·         Yellow Dog Contract – the employee signs a K agreeing not to join a union. These were very popular.  These Ks were responsible for the enacting of the Norris La-Guardia Act which said you cant exclude peoples rights to join unions.
·         Plant v. Woods, SC of Mass. (1900)
o   Facts: Contest btw. 2 labor unions. Def’s Union conspired to get Plaintiff’s union to join Def’s union by using coercion and intimidation
o   Holding: Act of Def’s union was malicious and unlawful. A union has no right to be protected against competition, but has the right to be free from malicious and wanton interference, disturbance, or annoyance. Acts were done intentionally to cause damage
§  Court relied on Carew v. Rutherford – the purpose of the D was to force the Ps to join D’s association, and to that end they injured the P in their business, and molested and disturbed them in their efforts to work at their trade
o   Holmes’ Dissent: free market should be able to breathe a little. Supports collective bargaining, but not violence.
Basic Rules:
§  Unions can’t try to destroy the business of Employers.
§  Court will grant injunction where: union’s objective is to deprive Employer and customers of right to freely conduct business and deprive public at large of advantages of technology, (this came up when union members were being replaced with technology)
§  Holmes’ was ahead of his time and Dissented in most cases – believes in employee rights.
2.      The Anti-Trust Laws
·         The Sherman Act (1890)
o   Congress declared unlawful “Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations”
o   Enacted during period of enormous corporate expansion
o   Objective: to eliminate agreements between manufacturers or suppliers to fix the price & regulate supply of goods. (eliminate threats to small business).
§  HOWEVER, Sherman Act quickly began to apply to labor unions more than business monopolies
o   Loewe v. Lawlor
§  Facts: Hatters Union wanted to organize Loewe’s Hat making business. Loewe refused. Hatters boycotted. Loewe sued  union for violating the Sherman Antitrust Act, alleging the union interfered with Loewe’s ability to engage in interstate commerce of selling hats.
§  Holding: Union acted in restraint of trade of the several states, thereby violating the Sherman Antirust Act
§  A national boycott initiated by the union and comprised of vendees in other states was a violation of interstate commerce.
·         Combinations efforts had to be viewed in aggregations. The fact that the union was not itself engaged in interstate commerce was irrelevant since the act did not distinguish the types of associations involved but simply forbade every contract, combination or conspiracy in restraint of trade.
o   Court will not invoke the Sherman Antitrust Act if there is only a “local motive” – local strike, local in origins, waging, motive, etc. (miners case)
·         The Clayton Act of 1914 and the Development of Unions
o   Clayton Act is now powerless.
o   Purpose: to limit the application of antitrust laws to union activity. Designed to break up the power of the corporations.
o   § 6 – antitrust laws shall not bar labor organizations from lawfully carrying out their legitimate objects
o   § 20 – imposed limitations on the power of the courts to issue injunctions in labor disputes “growing out of a dispute concerning terms or conditions of employment, unless necessary to prevent irreparable injury to property”
o   Duplex Printing (1921)
§  Facts: Union was pursuing the ends of a closed shop, 8-hour day, and union wages
§  Held: Court found antitrust violation by the union – a closed shop was not a legitimate object under § 6
§  The court held that proper union activity must be in proximate relation to a controversy between an EE and ER – other members of the union who were not EEs of Duplex had no relation to the dispute and were not able to make the dispute their own à the secondary boycott  – is not peaceful and lawful persuasion and therefore constituted a conspiracy to restrain interstate trade
o   Secondary Boycotts are illegal
o   Injunctions must be analyzed by “means” and “objectives” tests
Legislative and Constitutional Protections
3.      The Norris-LaGuardia Act (1932)
·         Enacted a

not only help employees but also employers.
o   SECTION 1 – Labor Relations Board to report to Congress a few times a year. NLRB is one of the few agencies that interprets the NLRA through adjudication instead of rule-making
o   SECTION 7: HEART of the ACT:
1.       Employees shall have the right to self-organization, form join or begin labor organizations, collective bargaining etc.
2.       Three rights:
1.      the right to organize
2.       right to bargain collectively (have some union represent you), and
3.      the right to engage in concerted activity (peaceful strike or picketing). Concerted activity is more than one employee or one on behalf of the others.
Ex: woman saying “we want a raise”. This is concerted because she says “we” and its protected because its about terms and conditions of employment.
·         These are fundamental rights of this country. These are now federal rights.
·         Assuming there is no prohibition of striking in your employment contract, the employer cannot fire you if you strike.
3.       Establishes a balance of bargaining power between the ER and EE. It is enforced through § 8
4.       Outlawed company-formed “representation plans” or work councils that were carefully controlled to give EEs forms of organization without the substance (company unions)
5.       ER has duty to bargain with the union that was selected by the majority of the unions to be the exclusive representative
6.       Left terms like wages/hours entirely to private negotiation –idea being government should refrain
o   SECTION 8: Outlawed employer coercian
§  Section 8(a): It is an unfair labor practice to interfere with restrain or coerce employees in regard to the rights given to you in Section 7.
·         Unfair Labor Practices:
1.      Interfere with, restrain, or coerce EEs in the exercise of their § 7 rights
2.      Dominate or interfere with the formation or administration of any labor organization
3.      Discriminate in regard to hiring or tenure of employment
a.       The effect of this type of practice is to scare others not to engage in unionization.
b.      Any other type of discrimination—any CHANGE in their term or condition of employment, such as being demoted.
                                                                                                                                                  i.      These Section 883 cases are the most difficult to investigate because the employer may have a legitimate reason for letting the person go or demoting them. We have to look at employer intention.
4.      Discharge against an Employee because he has filed charges or given testimony (retaliatory discharge).
5.      Refuse to bargain collectively with representatives of his Employees.
a.       once the union wins and they bargain for a contract both sides have to bargain in “good faith”.
o   Employer threatening discharge if the employee wants to be in a union.
o   company union- union controlled and set up by the company.
§  SECTION 3 and 4: Created the NLRB – established to administer and interpret ULPs and representation provisions of the Act
Wagner Act Amended in 1947à too pro-union