TEAMSTERS LOCAL v. LABOR BOARD

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Argument of Herbert S. Thatcher

Chief Justice Earl Warren: Number 64, Local 357 International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, Petitioner, versus National Labor Relations Board and number 85, National Labor Relations Board, Petitioner, versus Local 357 and so forth.

Mr. Thatcher.

Mr. Herbert S. Thatcher: May it please the Court.

The first issue in this case is whether the traditional employee referral agreement, sometimes referred to or called the union hiring halls, under which an employer agrees to obtain his workforce exclusively through the union, violates the Taft-Hartley Act and this, even though the agreement is non-discriminatory on its face, unless the parties to the agreement include in the agreement certain safeguards which are -- which had been prescribed by the Board and which I will indicate later.

A second issue is whether, assuming this agreement to be invalid, the Board, in framing a remedy, can require the union to return to all its -- its members hired under the referral agreement, their dues and initiation fees during a term of the agreement and for a period of six months prior to the filing of the charges.

That issue is also involved in case number 68, Local 60, Brotherhood of Carpenters which follows this case and which has been consolidated with this case for purpose of argument by arrangement of counsel and consent of this Court, Mr. Dunau will argue that issue in the next case which is in both these cases.

The sections of the law which are claimed to be violated by the referral agreement in this case are Sections 8 (a) (3) and 8 (b) (2) which forbid an employer or a union to discriminate employ -- in employment so as to encourage or discourage union membership.

The Board says the referral agreements, any referral agreement, any hiring hall inherently and ipso facto, operates to encourage union membership.

The hiring hall or referral system which -- under which employment is channeled exclusively through the union has, as this Court is undoubtedly aware, been and used in operation for many years in such industries as the building trade, maritime, stevedoring and some aspects of transportation where -- where the employment conditions are transitory -- transitory or irregular and the -- where in the absence of a central referring -- referral place such as the union hall or the hiring hall, the workers involved, usually craftsmen have to spend their time haphazardly searching for employment.

And the employer who needs a qualified workforce, a skilled workforce has to have an equally or has an equality haphazard search for that working force.

The salutary effects of the hiring hall in solving the employment problems peculiar to these particular industries had been noted by leading economists, by the members of management and labor, by members of Congress, by the courts and indeed by the Labor Board here itself, the Board's brief had meant as much.

Now, the issue of the legality of the referral agreements in this case arose in the following factual posture which is not in dispute.

In 1955, the petitioning union here, Local 357 of the Teamsters, along with some other 15 locals in the Southern California area entered into a three-year collective agreements with a trucking association, California Trucking Association, representing some 1000 carriers in the Southern -- Middle California and Southern California area.

And the particular employer, respondent in this case, Seattle or Los Angeles-Seattle Motor Express Company, is one of those carriers which is -- who was a member of the Carriers Association and which is a member of this referral, which is a party to this referral agreement.

Now, this referral agreement applies only to casual employees employed by these carriers and employed by Seattle Motor Carriers, not the regular drivers, just the casual drivers employed by these companies.

And the referral clause which is set forth on page 4 of our brief and page 62 of the record, states expressly that dispatching through the union in a hall located some three miles from a union headquarters was to be done exclusively on a basis of seniority in the industry.

In the entire industry covered by the contract, seniority became applicable after three months of employments and seniority was absolutely determinative regardless of whether any applicant was or was not a union member, that's expressly written into the contract.

If a union couldn't supply the necessary casual help, the employer was free to hire his own and as I indicated, the employer hired all his own regular employees.

Lester Slater, the individual involved in this case, was a member in good standing of the petitioner union for some two years prior to August of 1955.

And during that two-year period, he had obtained casual employment through the referral system set up in the contract.

In that -- at that time in August, through some mistake that's not relevant here, he obtained employment with Seattle Motor Express without going through the referral system under the contract.

When the union learned about this it asked the employer to let Slater go unless he went through the provisions of the -- unless he followed the provisions of the contract and the employer did let Slater go at the union's request.

Thereafter, Slater filed charges with the Labor Board and the Board issued its complaint against the union and the employer, Slater -- Los Angeles Seattle Motor Express alleging that the -- Slater's discharge operated to violate Sections 8 (a) (3), 8 (b) (2) as well as 8 (a) (1) and 8 (b) 1 (a) under the referral agreement.

The trial examiner dismissed the complaint in its entirety, finding that there was no evidence of any discriminatory application of the agreement, either at Slater or generally, and finding further that the agreement was valid on its face.

An appeal to the Board, the full Board reversed in a very short opinion in which the issues weren't discussed, but the Board did rely and referred to its recent decision in Mountain -- in the Mountain Pacific case, the infamous Mountain Pacific case, in which for the first time the Board had held that the union hiring hall or a referral system or agreement was invalid or operated to violate the law on its face and would be held violative of the provisions I just mentioned, unless a clause that contained express provisions prescribed by the Board which are as follows.

First, the agreement has to expressly disclaim any intent to discriminate and has to expressly state that it will not be applied discriminatorily as between union members and non-union members.

Second, it had to state expressly that the employer was free to reject any applicant for any clause at the employer's sole discretion.

And third, it had to require that either the referral agreement with these clauses in it be posted in places where it would be seen and read by applicants.

Justice William O. Douglas: Does -- does the union object to those --

Mr. Herbert S. Thatcher: Yes, Your Honor.

Justice William O. Douglas: -- provisions?

Mr. Herbert S. Thatcher: I will tell you by shortly.

The union does object to -- particularly to the clause which says that the employer has a completely free hand to reject applicants.

We feel that many collective agreements state that the union at least should have say on that and it maybe a matter for grievance procedure or arbitration if the union thinks that the rejection is arbitrary.

Justice John M. Harlan: Could I ask you a question?

Mr. Herbert S. Thatcher: Yes, sir.

Justice John M. Harlan: The effect of this, I want to make sure I understand you, does that mean under the Board's (Inaudible) specific that any union who does not comply with these conditions has such an agreement automatically (Inaudible) --

Mr. Herbert S. Thatcher: That is correct, Your Honor.

Justice John M. Harlan: -- irrespective of the administration of the agreement?

Mr. Herbert S. Thatcher: Irrespective of the administration generally or in respect to a particular individuals and also, the employer (Inaudible) the same unfair labor practices that are applicable as in employers, the 8 (a) sections.

Justice William J. Brennan: And now, this had not been the interpretation before (Inaudible)

Mr. Herbert S. Thatcher: No, Your Honor.

Prior to that, as I will indicate shortly, the Board had upheld these agreements.

Chief Justice Earl Warren: Was there any challenge to the finding of the examiner to the effect that there had been no actual discrimination in this operation of this hiring hall?

Mr. Herbert S. Thatcher: None -- none whatsoever.

The Board simply says that's irrelevant for reasons which I say that the agreement on its face must be held to inherently encourage membership.

Now, as -- as I've -- and as we've just been discussing, I -- the importance by the important here to note that there was no evidence whatsoever, none -- none in slightest that Slater here had lost his job because of his union membership or lack of it or -- or because of his activity in the union or lack of activity in the union.

As a matter of fact, he was a good member and standing at -- a member in good standing at the time of his discharge.

The Board so held in spite of the fact that it would have been a contract breach had any applicant been referred by -- on the basis of his union membership or lack of that and on a criterion other than his seniority.

And finally, as I indicated the Board it completely immaterial and irrelevant that there was no discrimination as to Slater or that there was no evidence whatsoever as to any discriminatory application of this referral agreement during its term.

The Board reasoned that under -- in Mountain Pacific and it applied the doctrine here that any agreement under which a union had exclusive control of hiring or referral will inherently operate to encourage union membership of the employees or the applicants being put in position where they feel that they must either cater to the union or become a union member in order to get referred and the Board concluded by saying that the inference of encouragements of union membership is inescapable for the mere existence of a union -- union referral agreement.

And this, even though the referral agreement itself has no discriminatory clauses in it such as that only union members will be referred or that union members exclusively have access to the agreement.

The union appealed to the Courts of Appeals here in the District of Columbia and in our brief and argument there and our -- in our first brief here.

I'm mentioning this because the Board has somewhat changed its position in its reply to our brief but in our argument before the Court of Appeals below and in our first brief here, we argued simply that the -- the Board in so inferring an unlawful act was basing its -- but it was concluding on a basis of mere inference and speculation that it was attempting to shift the burden of proof that it was -- or there was this duty and function to specifically prove by some credible evidence that there was a discriminatory application either as Slater or generally and that the Board was avoiding this burden.

Two of the judges below, Justices Miller and Danaher affirmed the Board in a per curiam without discussion.

Judge Edgerton dissented following with the arguments that we had made in the brief and at oral argument.

All judges however disagreed with the Board as to the remedy which had been adopted all holding that the Board had exceeded its powers in -- in requiring return of the dues and -- and initiation.

Now, the Board here in its reply brief has taken a somewhat different position to what it – it took below and from what the Board itself took in the Mountain Pacific case.

The Board now argues that Section 8 (a) (3) can be broken down into two parts.

The first part which deals with the discrimination in regard to hire, the word discrimination in that part of 8 (b) (8) and 8 (b) (3), 8 (a) (3) can be equated with the term difference or disparity so that if any difference or disparity has been brought about in hire, the first part of Section 8 (a) (3) is applicable and then the Board says that one fact difference is established even though it has no relation to union member -- membership as such, the Board then has a body of experts isn't -- is permitted or is to be permitted to look into the practical, practicalities of the situation and see whether the difference that had been created does operate in its judgment as experts to encourage or discourage union membership.

The difference --

Justice John M. Harlan: Mr. Thatcher, do you say that was in the government's reply brief?

Mr. Herbert S. Thatcher: That's in the government's brief.

Justice John M. Harlan: Now, is it in brief --

Mr. Herbert S. Thatcher: Brief.

Justice John M. Harlan: -- and not the reply brief (Inaudible)

Mr. Herbert S. Thatcher: No, in their brief which was in reply to our principal brief, we filed the first brief and the government filed its brief.

Justice John M. Harlan: Yes.

Oh, I was looking (Inaudible)

Mr. Herbert S. Thatcher: I'm sorry, Your Honor, the government's brief.

Now, the difference or disparity or discrimination here, says the Board, is the -- and as created by this hiring arrangement as by any hiring arrangement is found to exist in the creation of two classes of jobseekers, those who must apply through the union and those who must not.

By having found this alleged discrimination, the Board calls, it's a discrimination, the Board then with its special knowledge in the field concludes that these systems inevitably operate to encourage jobseekers either to become members or ingratiate themselves with the union so that the Board can reasonably conclude union encouragement and the Board need not demonstrate further that there was any actual discrimination because of union membership or any actual encouragement of union membership other than the mere existence of the union of referral agreement and the need for employees or applicants to go through that agreement to obtain their employment.

This -- this reasoning, we believe to be utterly places, a foul that would commit the Board to inquire into and imperil the whole fabric of collective bargaining.

All collective bargaining agreements as I will indicate shortly do create similar differences.

The term "discrimination" as used in Section 8 (a) (3) we say must necessarily have some reference or relationship to union membership or to union membership as such or some aspect of it and that the mere creation of two classes is not sufficient, which had nothing to do with union membership is not -- is not enough.

Now, before discussing this reasoning and our disagreement with it, I think it's important to point out to this Court that in all the years that this issue has been before the Board in previous cases, and there have been some seven-and-a-half years the Board has had various aspects of the hiring hall before it, all previous Boards have, without any difficultly, found the hiring agreements valid on its face and not violative of the Act on its face.

And in each case, the Board would find a violation of the Act only if it was shown there was some actual discrimination regard to union membership practiced under the agreement or as applied to particular individuals.

Chief Justice Earl Warren: Mr. Thatcher, is there -- are there any statistics to show how extensive the hiring-hall practice is in the country?

Mr. Herbert S. Thatcher: We have -- we have references in our brief to the practices in the different industry.

I don't think we have in our brief though actual statistics as to the how many hiring halls are in existence in each of these industries but the fact is and economic writers all indicate that the practice is quite extensive in the maritime and stevedoring and in building trade, less in transportation which we're involved with here, except in the casual part of transportation, (Inaudible) transportation which we have in this case where there are -- a similar agreements.

Justice William J. Brennan: Well, Mr. Thatcher, doesn't Landrum-Griffin give some statutory sanction hiring involved?

Mr. Herbert S. Thatcher: It does in the building trades field, it's --

Justice William J. Brennan: Only the building trades?

Mr. Herbert S. Thatcher: Only the building trades field so Landrum-Griffin amendments don't affect this case except in the building trades field.

Similarly, the courts, all the courts that have considered the question prior to the Board's decision in Mountain Pacific, all the courts, the Circuit Courts of Appeals that have considered the question of -- of each of them upheld the hiring hall as such as long that it didn't contain in it an -- a discriminatory clause or as long as there was no discrimination in practice under it or a discriminatory application under the agreement.

This is the first case, Mountain Pacific was the first case and it's the first case in which it was -- was applied to the (Inaudible) remedy in which it has been held invalid on its face.

The Circuit Courts have splits and to whether the Board's Mountain Pacific doctrine is proper under the Act and that's why the case is here.

Two circuits have held with -- with the Board and two and perhaps three have held against the Board, usually in spilt decisions.

Further, the legislative history of the 1947 Amendment indicates quite clearly that there was no intent by Congress to outlaw the hiring hall at such -- as such but only discriminatory practices under it.

Senator Taft, our brief page 23 quotes two excerpts from statements by Senator Taft.

One --

Justice Charles E. Whittaker: They didn't outlaw it?

Mr. Herbert S. Thatcher: Pardon?

Justice Charles E. Whittaker: Was the Board's view would outlaw --

Mr. Herbert S. Thatcher: The Board's view would outlaw the union referral agreement unless it contained these three proscriptions.

Justice Charles E. Whittaker: Yes.

(Voice Overlap) --

Mr. Herbert S. Thatcher: It would outlaw the agreement in this case because it does not have these three conditions.

Justice Charles E. Whittaker: But arguably, you do (Inaudible) --

Mr. Herbert S. Thatcher: Well --

Justice Charles E. Whittaker: (Inaudible)

Mr. Herbert S. Thatcher: Well, that is right Your Honor but I will tell why it doesn't satisfy the union shortly.

So as far as legislative history is concerned, it's quite clear and I don't think the Board argues to the contrary that Congress intended to outlaw the hiring hall as such which -- which on its face was not discriminatory or which is not discriminatory in application, just quite clear.

Now, turning to the Board's rationale which would mechanically apply to Section 8 (a) (3) and -- and use the Board's alleged expertise to infer or preclude that the inevitable result of hiring halls was to encourage union membership.

We say, first of all that the Board has failed adequately to define a relevant class.

The relevant class in this case and in other hiring hall cases is not those who must go through the union form plummet or not at all anymore than it would be, all that have to go through an employer or not at all.

The relevant class, the only irrelevant class which the Board should consider is the class the employees or all employees or applicants who seek casual employment, all applicants who seek casual employment.

Now, as to this class, it's quite clear that there is no discrimination all in that class, all seeking causal employment are dealt with evenhandedly on an equal basis.

All are referred for employment regardless of membership or non-membership and solely on the basis of seniority.

What the Board is really saying is -- here as in their attempted classification is that to enforce a uniform standard applicable to an entire class is to discriminate against those who disregard it.

It's like saying that people who try to get into a restaurant before or after closing hours and are excluded because the restaurant has a rule that you can't get in or out the restaurant before or after closing hours are discriminated against as distinguished from a -- a discrimination which might result from their race, religion or union affiliation, the same sort of analogy, the Board is -- is -- in dealing with here.

Now, we say this, if the creation of a class of those who have to go through the union for employment constitutes discrimination that that really can constitute discrimination that their creation of that class of those who have to go through the union for employment then under all collective agreements, many similar classes of alleged discriminations are created.

The most obvious example of course is the fact that the union under -- under a type of bargaining agreement is the exclusive bargaining representative and employees have to look to the union to protect their rights under a collective bargaining or not at all.

So therefore, they -- the Board could reasonably infer I suppose that the -- that union membership is encouraged.

And even more striking usual clause is the grievance clause in most union contracts under which the union handles grievances exclusively.

There again, this creates a class that go through that -- go through the union and those who do not and it could reasonably be said by the Board that the employees are subtly – subtly encouraged to be friendly with the union or to join the union or to ingratiate themselves with the union just as they do because of the existence of the hiring hall and there are more -- even more barring examples.

The one before this Court, in Aeronautical Industrial Lodge versus Campbell, 337 U.S. 2 – 521, there the collective agreement provided that union stewards be accorded seniority -- super seniority even beyond war veterans solely on the basis of their being union stewards.

This Court upheld that alleged discrimination in that case although the NL -- the National Labor Relations Act was not directly involved there.

However, later, when this Court did consider a similar type of seniority clause in Ford Motor Company versus Hoffman, it reverted back to the Industrial Lodge case and held -- and then indicated by way of dictum at least that the seniority clause in Aeronautical Lodge versus Campbell would not violate the National Labor Relations Act.

We submit that's most obviously, if that clause would not violate the Act then certainly, the mere existence of a referral agreement would not violate -- violate the Act because of a tendency or some sort of an -- tendency to encourage union membership.

What the Board forgets is that the union -- all unions are service institutions and the more and the better they service, the more they are likely to encourage membership.

So, all of union functioning could be drawn into possible violation of the Act by virtue of some inherent tendency to encourage membership.

I don't think the Board is going to argue that but it's the -- it follows from what they are trying to assert here in hall and –the hiring hall inherently unlawful.

Similarly, employers have many occasions to affect employment rights in their discharges, layoffs, promotions and demotions where a discrimination I suppose is created but where of course the Board is required to show that there was an actual intent to discriminate because of union membership or a lack of it by reason of the demotion or layoff.

Justice Charles E. Whittaker: May I ask you Mr. Thatcher, would the Board to have the right to lay down general rules found in its experience to be needed in order to make hiring halls better?

Mr. Herbert S. Thatcher: We believe not for these reasons, Your Honor.

In the first place, the -- the hiring hall agreement of clause is a subject matter, a very important subject matter of collective bargaining.

In these industries in particular, it is probably one of the most important portions of the collective agreement.

We feel the party should be free to negotiate their own clauses without interference from the Board particularly where as I will indicated shortly that there's -- if these causes are not in themselves and cannot in themselves be called illegal.

We -- we resent suggestions from the Board, let alone mandates from the Board, as to what should be put in to collective agreements before we can use them, before we can agree to particular clauses.

And we say that if these clauses are valid without these conditions that the Board seeks to impose, there is no reason in law or in policy why we shouldn't be permitted to make our own agreement the employer and the union and enforce them according to their terms.

Now, in addition as I will show shortly, the -- the particular clauses are -- the particular conditions which the Board seeks to impose upon us are objectionable, in particular the one which says that we have -- we have no right to have any voice in rejections of applicants.

But apart from that, I think it's very important that -- but we think it important that we be permitted to -- to maintain the rights and negotiate our own contracts if they're legal, free from Board interference.

Chief Justice Earl Warren: We'll recess --

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Argument of Herbert S. Thatcher

Mr. Herbert S. Thatcher: Just before the recess, we were discussing the reasons why the unions object to the Boards attempting to condition their union rapport.

I think -- I don't think I have pointed out in this case as yet, however that here, the Board assumes in illegal agreement of some sort before it even attempts to impose a condition, it attempts to impose a condition only as a means of achieving -- of eliminating what it thinks is illegal about the agreement.

So under the Board's own rationale if as I've indicated, the agreement is -- and must be considered legal on its face because not discriminatory on its face or an implication, then the Board's right even to impose conditions is lost.

Now, obviously, if the agreement were legal without these conditions, the Board would have no right to impose these three conditions because it would be a direct intrusion on the collective bargaining process which this Court in the Oliver case and in American National Insurance and the many other cases that says, "It's not the Board's function."

It is commerce's function to impose conditions like that if it thinks the hiring hall in some way should be tampered with or if it thinks the unions and the employers should not have a right to make their own agreements.

That's for Congress to -- to do, not for this Board.

And so, on any other postulate but -- that the agreement itself on its face is illegal, the Board would have no power to impose these conditions, I think that's clear.

Now, turning to the specific conditions once more --

Justice Hugo L. Black: How are they promulgated?

Mr. Herbert S. Thatcher: Just by an edict to Mountain Pacific, we -- we hereby state that you can't have a union referral agreement which we find on its face to be illegal which -- which in all such agreements, we -- we conclude are illegal because they encourage membership unless, you put in one, two, three.

Justice Hugo L. Black: Did the action rest on -- or purport to rest on any specific provision of the act of the law itself --

Mr. Herbert S. Thatcher: None --

Justice Hugo L. Black: -- authorizing the Board --

Mr. Herbert S. Thatcher: None, Your Honor the Board --

Justice Hugo L. Black: -- promulgates the rules or --

Mr. Herbert S. Thatcher: No promulgates the rules --

Justice Hugo L. Black: -- regulations.

Mr. Herbert S. Thatcher: -- no provision of the law, no legislative history, merely something which the Board in its expertise deemed -- this Board at least deemed was necessary in order to have a proper union referral agreement under the Taft-Hartley Act.

All previous force just as expertise did not have this dealing but this Court has imposed these three conditions.

Justice William J. Brennan: Any division in the Board in Mountain Pacific?

Mr. Herbert S. Thatcher: There was when -- when Senator Murdock was on the Board, he dissented the Mountain Pacific.

The present Board, there is no -- no dissent.

Now, on the three conditions, the unions object very strongly to being required to expressly include the provisions which says that they aren't going to discriminate because that adds a -- a contractual obligation not to discriminate, in addition to the statutory obligation not to discriminate.

Thus giving -- thus, if there is a violation giving two remedies, thus the remedy of a contract violation being available in whatever form someone might be able get into.

And if there is any discriminate, we'd rather have the Board and look rather than some course.

We think this is a matter primarily to the Board to worry about --

Justice Hugo L. Black: Is there are any other -- pardon me but is there any other N.L.R.B. case besides the one you were -- in which you refer Mountain Pacific chapter that --

Mr. Herbert S. Thatcher: Well, there's dozens of them.

Justice Hugo L. Black: -- discuss it because I'm not talking about the (Voice Overlap) --

Mr. Herbert S. Thatcher: Mount Pacific is the only --

Justice Hugo L. Black: -- questions --

Mr. Herbert S. Thatcher: -- is the only case where the rationale --

Justice Hugo L. Black: -- explained it.

Mr. Herbert S. Thatcher: -- will be discussed.

I think that's a correct statement.

Mount Pacific is the only case where they really discuss the rationale.

That's set forth --

Chief Justice Earl Warren: What was the date of that -- what was the date of that opinion?

Mr. Herbert S. Thatcher: Of the --

Chief Justice Earl Warren: Mountain Pacific Chapter.

Justice William O. Douglas: March -- March 1948?

Mr. Herbert S. Thatcher: 1950 -- 1958, March, 1958.

Chief Justice Earl Warren: 1958?

Mr. Herbert S. Thatcher: March, 1958, I think 1958 or April 1, 1958.

Justice William O. Douglas: March, 1958?

Mr. Herbert S. Thatcher: April 1, 1958.

April 1, 1958.

Justice William O. Douglas: What -- I've been reading this Board opinion in that case.

They apparently go on the theory that they need the -- these protective provisions because they say as respects the non-union members that may be hired, they will be -- instead their concern is and must be, "What about themselves?"

will probably please the union or their agents.

How can they conduct themselves best to conform with such rules and policies as unions are likely to enforce?

In short, how to ingratiate themselves with the union regardless of what the employer's desires and needs maybe?

That was their (Voice Overlap) --

Mr. Herbert S. Thatcher: Well, that's their rationale.

Justice William O. Douglas: But what do you say to that?

Mr. Herbert S. Thatcher: Well, that same rationale as I said implies to all collective bargaining agreements where the union is the -- is the exclusive representative and pretty much ingratiate themselves to use the Board's phrase or where the union has to do with the grievance settlement or where -- where if you're a union steward, you can get super seniority.

All sorts of conditions in collective agreements might give unions -- might bend the employees under the agreement to get in good with the union but that doesn't -- is not enough.

There has to be an encouragement or a discrimination based on union membership which we haven't got here anywhere.

The Board merely assumes -- infers that there -- that there is some inherent encouragement in -- in hiring halls.

Congress didn't find so, Congress didn't think it's necessary to legislate on it.

All previous Boards didn't think so.

This particular Board has relied on some or mostly about 12 cases in which this had the hiring hall actually before it and from that assumes this.

We have -- if -- if that assumption is to be made in the case of the union where the employment is channeled through the union then the Board should make the same assumptions when the employment is channeled to the employer because employers, the -- the statistics show are 10 times discriminatory as unions when they have a chance to reject or not reject on their own.

So by the Board's same reasoning, these standards and -- and these three conditions should be a test to the employer's right to hire on his own when he is the exclusive source of employment, the employer because the record show, experience shows that employers are much more discriminatory than unions.

So, the whole -- that that I grab will be ridiculous but that is the Board's reasoning in this case.

And that -- that that's why we say, you have to show some actual intent as in the case of Slater here get after Slater because he didn't abide by some union rule before he could be discharged.

In this case, Slater was discharged not because he was a good, bad or in different union member at all.

He was discharged solely because he didn't do what all other employees in industry or other casual employees in the industry do go through the contractual provisions for employment.

And accordingly, all he was discharged for was for failure to comply with the proper collective agreement before the Board to -- to seek to reinstate in a given back pay as to afford the protections of the Act to deliberate contract breaker.

That's all Slater was.

Justice Hugo L. Black: Suppose he had come to the hiring hall of the union, what would have been his --

Mr. Herbert S. Thatcher: He was been referred.

Justice Hugo L. Black: -- what have been his rights?

Mr. Herbert S. Thatcher: He would have an absolute right to be referred on the basis of his union seniority for two years prior to when he was fired, he was -- he had gone through the hall and had been referred on each and every occasion --

Justice William O. Douglas: Was he --

Mr. Herbert S. Thatcher: -- based on his seniority and he was a member of good standing.

So, how could there be any union encouragement?

There's no point and he was a member in good standing of the union when he was discharged at the request of the union for not going through the procedures set forth in the contract not because he was not a good union member or bad union member or he was in bad with the union, not bad at all simply as refusal to go through the hiring procedure which been set -- had been set up by the employer and the unions in the whole Southern California area, many thousands of employees involved to regularize and channelize employment.

Justice John M. Harlan: Does the record show why he went through the -- why he refused to go through the hiring?

Mr. Herbert S. Thatcher: Yes, it's not material here but there was -- he went under the mistaken belief and didn't have to at one point.

He's had a letter from someone not authorize to give a letter saying he could get the job without going through it, this particular job.

And it was a -- there was -- letters shouldn't have been given, it was given by an unauthorized representative.

The Board doesn't claim that that amount to referral, proper referral, so the situation is -- is exactly as if he never went through the hiring procedure at all which he didn't.

Justice Hugo L. Black: What was his status after the union took the matter after his employer and he was denied the place?

Mr. Herbert S. Thatcher: Then he -- well, I don't think (Voice Overlap) --

Justice Hugo L. Black: What about his status with reference to it?

Mr. Herbert S. Thatcher: The record doesn't show whether there was any disciplinary action taken by the union against him.

Justice Hugo L. Black: Well --

Mr. Herbert S. Thatcher: That is --

Justice Hugo L. Black: I --

Mr. Herbert S. Thatcher: That's (Voice Overlap) --

Justice Hugo L. Black: I understood you to say that he was -- that he was discharged?

Mr. Herbert S. Thatcher: He was discharged at the union's request because he had failed to comply with the contract referral.

Justice Hugo L. Black: And that's what's found to be unfair labor practice?

Mr. Herbert S. Thatcher: The Board found that to be violation of 8 (a) (3) by the employer and 8 (b) (1) or 8 (b) (2) by the union.

Justice Hugo L. Black: Now, after he was discharged, what was his status with reference to future employment?

Mr. Herbert S. Thatcher: Well, if he went through the hiring procedure, he was free to get another job.

Justice Hugo L. Black: Automatically?

Mr. Herbert S. Thatcher: Automatically.

He chose to go to the Labor Board and file charges.

Chief Justice Earl Warren: His discharge would have no effect on his subsequent right to go through the hiring hall the regular way --

Mr. Herbert S. Thatcher: Not --

Chief Justice Earl Warren: -- and (Voice Overlap) according to similarly?

Mr. Herbert S. Thatcher: Not --

Justice William O. Douglas: Suppose, I was a --

Mr. Herbert S. Thatcher: I don't think the record showed either way but I -- I know, it wouldn't --

Chief Justice Earl Warren: Yes.

Justice William O. Douglas: Suppose, I was a non-union member, a non-union employee, I'm not a member of the union, how would I work -- how does it work in the hiring hall as respects me?

Mr. Herbert S. Thatcher: You -- it makes no difference at all whether you're union member or a non-union member or a union officer or non-union officer or anything to do with the union.

If you have seniority in the industry and as the whole Southern California --

Justice William O. Douglas: But I -- I have to go through the union?

Mr. Herbert S. Thatcher: You'd have to go through the union, show your seniority, they keep records as to your work with the different employers, to see it's an intermittent scattered thing for -- one day at a time.Here, there with a thousand different employers.

They keep records and that's maintained in the central hall, the union -- the union referral hall and then they look at the record to see, "Well, what's your seniority in the industry?"

And then you're referred on the basis of that seniority, you got the most seniority, you're the first outs.

The Board disclaims any intent to discriminate on the basis of union membership as such here at all.

That isn't in this record.

Board thinks it's immaterial.

The Board simply said that the mere fact that you have to go the union at all --

Justice Charles E. Whittaker: Well, is the --

Mr. Herbert S. Thatcher: -- makes to the thing illegal.

Justice Charles E. Whittaker: Does the Board concede that it's immaterial or you may say they could prove it, but they need not?

Mr. Herbert S. Thatcher: They concede that it's immaterial.

They say that's irrelevant.

Justice Hugo L. Black: Is that the --

Mr. Herbert S. Thatcher: I'll reserve the remaining time --

Justice William O. Douglas: Where is the provision in the contract on promising no discrimination?

I don't see that in those -- in those terms.

Mr. Herbert S. Thatcher: Page 4 of the brief, here.

On the page -- on page 4 of the blue brief, the second paragraph of the -- the second sentence of second paragraph, no casual employees have employed by the employer with prior to disagreement in violation of senior -- seniority status is such employers are available then it says further commitment.

Justice John M. Harlan: It's a preceding (Voice Overlap) paragraph, isn't it?

Mr. Herbert S. Thatcher: (Voice Overlap) -- preceding.

Yes, and the preceding sentence says, “Seniority rating preceding" -- at the bottom of the preceding paragraph.

“Seniority rating of such employers shall begin with a minimum --

Justice William O. Douglas: I think by three.

Mr. Herbert S. Thatcher: On service.

Justice William O. Douglas: Thank you.

Mr. Herbert S. Thatcher: Thank you.

Chief Justice Earl Warren: Mr. Come.

Argument of Norton J. Come

Mr. Norton J. Come: May it please the Court.

As Mr. -- Mr. Thatcher has indicated, this case involves the validity of the Board's so called Mountain Pacific doctrine which has been approved by the court below and by the First Circuit and rejected by the Ninth Circuit and to some extent by the -- by the Sixth Circuit.

Now, in the Mountain Pacific case which was the basis for the decision here, the Board -- there's a combination of its more than 10 years experience with union control hiring hall arrangements.

Concluded that an arrangement between an employer and a union which gives the union exclusive power to clear applicants for an employment, in short, an exclusive hiring hall arrangement.

In conditions the employment upon such clearance, violates the provisions of the Act, Sections 8 (a) (3) and 8 (b) (2) which ban discrimination in employment to encourage union membership.

Absent, adequate assurances that job applicants will be referred without regard to union membership considerations.

Now, the basis for the -- for the Board's conclusion is briefly this, “That an exclusive hiring arrangement, even if not in terms restricted to union members, affects a discrimination in employment by treating employees differently who seek employment directly, what the employer is distinguished from those who go through the hiring hall.

The -- the experience of Slater here indicates that.

By going to the employer directly for this job instead of through the union hall, he suffered discharge.

He -- he was able to get a job but he wasn't able to keep it.

There could be no clearer discrimination in employment.

However, that isn't enough to establish a violation of Section 8 (a) (3), 8 (b) (2).

The discrimination in employment has to encourage union membership and that is where the front of our case calls occurrence.

I'm -- I'm showing that the Board had a reasonable basis in its experience for concluding that a contract arrangement that require the employees to clear through the union before they could get a job, could reasonably tend to encourage union membership adherence to union policies and practices, absent -- the safeguards which the Board has promulgated in which I will get to in a moment.

Now, the Board found that the hiring provisions of the contract here required the Motor Carrier of Los Angeles and Seattle to obtain casual employees solely through the dispatching service operated and controlled by the Union and that Slater was discharged for failure to follow this procedure.

And that the hiring procedure was invalid because it did not contain the Mountain Pacific safeguards.

There's no question, I might add to these safeguards are three fold.

In the first place, it must provide that -- that the basis for referral will be without regard to union membership or compliance with union rules.

The employer shall have a right to reject applicants referred.

And thirdly, that the standards for operating the hiring hall should be posted so that the employees will know what they are.

Now, there's no question that this contract here did not contain a posting requirement nor did it provide for a right to reject on the part of the employer.

Furthermore, the Board found that the unequivocal assurance that hiring would be without regard to union membership considerations was also lacking here in that although, the contract does provide that seniority shall govern dispatch.

The gap in there is that you can only get seniority after you've worked for three months in the industry and there is no assurance in this contract that in inquire -- in acquiring the three months seniority that you will be dispatched without regard to union membership considerations and you can lose seniority if you are discharged by an employer.

And that apparently is what happened to Slater here that he had lost his seniority because when he went out on a job, he wasn't able to -- to perform it.

And as a result, he had difficulty getting the union to refer him which resulted in this effort to get an authorization from the International Representative of the union that would permit him to work without going through the hiring hall.

And when the union learned of that, they said, “That's no good,” and procured his discharge for not getting through the hall.

So that you could lose seniority under this arrangement very readily and there was no assurance that you could build it backup without regard to your adherence to union rules.

Justice Hugo L. Black: Did you admit the statute defer on that?

I asked you the question as to what was the man has stated after the action authority is taken (Inaudible) what precisely had been thorn and he -- and he gone there for referral and he would've been referred for seniority?

Mr. Norton J. Come: Well, there is no specific finding on -- on that, Justice Black.

There -- the only thing that the record shows is that Slater had difficulty getting a job through the union hall because of the fact that he had been discharged by an employer after being referred on one occasion.

As a result of that difficulty, his landlady tried to patch things up and got this letter from the International Representative of the Union that said it would be okay for him to -- to work without going through the hall.

Justice Hugo L. Black: That -- that -- as I gather it, filing -- no filing or it means no more than this from what you say.

I'm -- I was wrong that he didn't want to go there to be referred, he didn't go.

He went to the employer and they discharged him, then he wanted to still continue to want to go get a job without referral.

He got a -- tried to get a national officer to get him there.

But do you have any --

Mr. Norton J. Come: I am not -- I am not suggesting that the Board has found that this hiring hall was operated discriminatorily.

That is not the basis for the -- for the Board's decision I will get --

Justice Hugo L. Black: Your basis is as I understand it, it's inherently by --

Mr. Norton J. Come: That is -- that is --

Justice Hugo L. Black: -- the Board has found, it's so inherently susceptible of abusive --

Mr. Norton J. Come: That is correct --

Justice Hugo L. Black: -- by the Union that it is an unfair labor practice for them to put that on the contract.

Mr. Norton J. Come: That is correct, without the -- without the safeguards.

Chief Justice Earl Warren: I understood Mr. Thatcher to say that -- that there was an express finding by the examiner that -- that there was no discrimination in this situation and that that was not challenged.

Mr. Norton J. Come: I do not find that there was such an express finding.

There is no finding that there was discrimination, let me -- let me put it that way because this case was tried before the examiner on a -- on a slightly different theory and that's the reason why there was an affirmative finding as -- as Mr. Thatcher has -- has suggested.

The theory on which it was tried was that Slater was a regular employee and not a casual.

Therefore, he wasn't required to resort to the contract procedure which was applicable only to casuals and the examiner found that in fact he was a casual employee and that he was properly discharged for not resorting to the contract procedure and ended the matter at -- at that point.

He didn't go on to find whether the hiring hall was discriminatory thoroughly operated or not.

The Board in its -- in its decision however, in applying the Mountain Pacific principle did not find that the hiring hall was discriminatorily operated because the Board's position is that that factor is irrelevant, the mere existence of an arrangement that require as an employee to clear through the union to get a job without warrant inherently encourages union membership.

It's an analogous to a -- a closed-shop contract which unquestionably standing alone, inherently encourages union membership and affects a discrimination which is violative of the Act.

Chief Justice Earl Warren: How about a union shop?

Mr. Norton J. Come: A union shop does not for the specific reason that the proviso, the Section 8 (a) (3) has a specific provision that permits such an arrangement and that is all of it if it permits.

That is the sole exceptions of the general ban against discrimination in employment to encourage union membership which is set forth in the Section 8 (a) (3).

Chief Justice Earl Warren: But I -- I was just thinking about the policy of -- of the union shop as compares with the policy of this kind of a -- of a hiring hall, wouldn't it be far more encouragement to join the union, to have a union shop agreement than to have an agreement of this kind?

Mr. Norton J. Come: Well, there's one big difference, Your Honor and that is the --

Chief Justice Earl Warren: Well, there's a different alright but --

Mr. Norton J. Come: There, the difference is that in this kind of a set up as with the closed shop.

If the Board's promise is correct, the employee is not going to get a chance to get to that job without being encouraged to become a union member and that is at that the threshold of the protection that 8 (a) (3) of the Act was supposed to give the employer.

The union shop doesn't come in to play until after the employee has gotten a job.

He doesn't have to be a union member or he isn't supposed to be influenced towards becoming a union member until he gets on that job.

And then he's given 30 days to make up his mind as to whether he wants to join or not assuming that the union has some adjourn.

Under the closed shop, he can't get to that job without being a union member and under the Board's view of an exclusive hiring arrangement without the Mountain Pacific safeguards, the impact on the employee is the same.

Chief Justice Earl Warren: But wouldn't you say that that as the approach that 30 days as a non-union member with the thought that he was about to lose his job permanently at the end of the 30 days unless he joined the union that there would be some encouragement offered by such an agreement to -- to join the union?

Mr. Norton J. Come: There is no question that it would Your Honor --

Chief Justice Earl Warren: But what did that --

Mr. Norton J. Come: -- but the point of -- but the point is, Congress in -- in balancing the respective interest here realized that the Union in certain circumstances might have a right to force the employee to make -- make the decision but they wanted to make sure that he had the right to get to the job without being unduly influenced.

Justice Hugo L. Black: Well, how could you guarantee that with the second provision of the Board's holding unless, you assume that the employer never wants to encourage him either to belong or not to belong to a union?

As I understand it, the Board is here because I thought you said that whether this contract bears three reasons.

One of which is that even though a union selects the man on the basis of seniority, in fact sent to the employer, the employer must be left with the right to reject him contrary to the contract he made.

I don't understand the -- the reason for that.

Mr. Norton J. Come: Alright, we'll let me --

Justice Hugo L. Black: And then in connection with the arguments you're making --

Mr. Norton J. Come: Well -- well, let me -- let me try to amplify that if I may, Justice Black.

And I -- I'd like to begin back a little ways if I -- if I may.

As I said at the outset as the -- as the Board views Section 8 (a) (3) and we believe that this Court's approach to that Section and its counter part 8 (b) (2) and the Radio Officers case supports that.

There are two elements to the violation.

You have to have a discrimination in employment and the discrimination in employment must encourage union membership.

Now, in Radio Officers, this Court held that you either -- that you didn't have to -- that you didn't have to prove a purpose to encourage, although you I believe dissented from that holding, Your Honor.

If it was reasonably foreseeable from the nature of the discrimination, if it was then you could impute the intent to encourage under the common law of principle that one is presumed to intend the reasonable consequences of his acts.

Justice Hugo L. Black: Either to the employer or the employee?

Mr. Norton J. Come: Now, the -- that is correct.

So, that you need your discrimination in employment and it must be of such a nature that it would reasonably tend to or the foreseeable consequence of that is to encourage union membership and Radio Officers holds that union membership means not only to become a union member but to be a good union member.

In other words, comply even if you are a union member or with the -- with the union rules.

Now, the discrimination, the Board finds in the despair treatment between the employee who has to go through the hiring hall and the employee who tries to get the job directly.

Now, so, you have -- you have the discrimination in employment in the Board's view and the question is, "Can it be said that a foreseeable consequence of -- of requiring employees to go through to the union in order to get a job is that they will be encouraged if they're not union members to become union members or if they are a union member to make sure that they're in good standing?"

Now, the Board, as a result of its experience with these hiring hall cases in the 10 years that they lived with them since the enactment of Taft-Hartley, found that despite the -- the ban on -- on closed shops that Taft-Hartley was supposed to have imposed, the closed shop continue to exist and by enlarge, it was present in the situations of intermittent employment where the hiring hall was the -- was the basis on which employees had to get jobs.

The Board concluded that in the light of what the employees in these industries knew about the way the hiring hall was operated.

It was reasonable to infer that they would tend to be encouraged for union membership if all that you said was, “You had to go through the union in order to get a job.”

In other words, that discrimination tended to encourage union membership as the First Circuit summed up in the case in which they held with this which is referred to in our brief and if I may quote for a moment.

"In our opinion, the Board could well conclude that an applicant who must be cleared for a job by a union hiring hall will fear that his opportunity of selection will be small if he does not become a union member in view of the widely accepted belief often encouraged by unions themselves that hiring halls do operate in a discriminatory nature."

So, the basis of the Board's Mountain Pacific decision is not that the union would necessarily discriminate in referring but that the employees would reasonably tend to believe that if they were a union member, they would stand a better chance of getting a job.

Justice Hugo L. Black: Do you think could be in a different with these conditions entirely?

Mr. Norton J. Come: The Board believes that that encouragement, that unlawful encouragement would be minimized substantially by the conditions which the Board has enunciated in the -- in the Mountain Pacific decision.

Justice Hugo L. Black: Suppose they don't put that in, wouldn't it be an unfair labor practice for them to operate their hall --

Mr. Norton J. Come: It would be --

Justice Hugo L. Black: -- should we ask to discriminate?

Mr. Norton J. Come: What is -- what is that Your Honor?

I'm sorry.

Justice Hugo L. Black: Wouldn't it be an unlawful -- wouldn't be an unfair labor act from -- to discriminate against the non-union man even if this is not in the contract?

Mr. Norton J. Come: Well, if I understand --

Justice Hugo L. Black: I thought it -- I thought it would have, I'm -- I'm just asking when (Voice Overlap) --

Mr. Norton J. Come: If -- if despite these conditions --

Justice Hugo L. Black: No, forget the conditions --

Mr. Norton J. Come: Yes.

Justice Hugo L. Black: -- it's not in the contract but they do discriminate and decline to let a union man go -- non-union man do that who has seniority, wouldn't that be of unfair labor act?

Mr. Norton J. Come: That would be an unfair labor practice, yes, Your Honor.

Justice Hugo L. Black: Well --

Mr. Norton J. Come: But --

Justice Hugo L. Black: That's what -- what this is doing in effect one, is simply to get them to say they won't violate the Act.

Mr. Norton J. Come: Well, the Board feels that there is an inherent encouragement in the -- in the contract provision standing even apart from the -- its discriminatory operation.

There's no question that a closed shop contract for example, standing alone without regard to its application violates the Act because on its face, that has an inherent -- well, it -- it affects a discrimination and it has an inherent encouraging effect.

In the Board's view, an exclusive hiring hall contract without the safeguards has the -- has the same effect and we submit that the Board could reasonably make that judgment in the light of its experience with hiring halls.

But the point that I want to make is that the safeguards go to cure the unlawful encouragement.

They do not bear on the discrimination because in the Board's view that exist from the fact that the hiring hall sets up this arrangement, whereby you're going to be fired if you don't go through the union to get a job.

The mere fact that that rule was applied uniformly isn't enough to save it from being discriminatory if it has the encouraging effects that are prescribed by -- by 8 (a) (3) as this Court pointed out in Shelley against Kraemer, the indiscriminate application of -- of a -- of an -- of any qualities doesn't -- doesn't make it proper.

I mean, the mere fact that -- that this hiring hall is -- is applied to all casual employees doesn't assure the defect in it if the Board is correct in saying that it has this inherent encouraging effect.

And the safeguards that the Board has promulgated go toward mitigating the unlawful encouragement and if it is viewed in that light, then I think much of the union's argument as to how could they conceivably have any reasonable relationship to the problem disappears because they are not addressed to the presumption that the union is going to discriminate.

They're addressed to the dissipating of the beliefs of the employees that they will be better treated if they adhere to union policies and -- and union rules because --

Justice Hugo L. Black: Why would the union man think he's going to get better treatment merely because you left the employer with the right to refuse him even though he had seniority?

How could he anticipate that the employee was treated better because he was a union man?

Mr. Norton J. Come: Well, the right to reject bears on the point that the Board judgment is that the employee will feel that if he has to go to the union in order to get a job, the question that is going to govern the union in referring him is not necessarily what skills does he posses but how well has he complied with union policies and how good standing is he in union affairs.

If the employer is given the right to reject, the Board believes that --

Justice Hugo L. Black: You mean if the employer has taken away from him the right to follow a procedure where he selects the man who has seniority, that's what it is, isn't it?

Mr. Norton J. Come: Well, the point is that just because seniority is -- is made the basis, that doesn't necessarily end it if there is -- if the Board is correct that requiring the union to be the exclusive operator of this arrangement has an inherently encouraging effect.

The mere fact it's put in a contract doesn't establish the legality of the -- of the procedure.

The union for example, couldn't agree to a contract provision that made seniority depend upon when an employee became a union member.

We have to look to more than the fact that seniority here is made the basis for the -- for the referral.

I've pointed out that you may never get enough service to acquire seniority here under this arrangement.

There is no --

Justice Hugo L. Black: And in the -- that's -- that's an argument against employer and employee having the right to make an agreement.

They will apply according to seniority, they're two separate things.

One is that and the other is where the union should be allowed to administer to the extent that it's allowed under the contract.

Mr. Norton J. Come: Well, the Board feels that if you're going to give the union the exclusive power to clear people for employment without any safeguards --

Justice Hugo L. Black: But even there are safeguards, they discriminate.

Can't the Board hold them guilty with unfair labor practice?

Mr. Norton J. Come: Well, there's no question that the Board could do that, Mr. Justice Black, they could also hold a union and an employer liable if they should require an employee to join a union as a condition of getting employment.

In other words, a closed shop arrangement but you have an additional violation from the mere fact that this contract is standing there over the heads of the employees if the type of provision and in the Board's view, this hiring hall arrangement is such is of such a nature that it would discourage them or encourage them before they ever get to -- get the first base.

Justice Hugo L. Black: Well, I can understand your argument or the Board's argument that hiring halls are inherently beneficial to unions and that means on the question, "What Congress done about it, has it said anything or declined to say anything or taken any action or refuse to take any action?"

Mr. Norton J. Come: Well, let me tell you what Congress says as gone here.

In the first place, with respect to the Taft-Hartley amendments which banned the closed shop, the classic example that was given of a closed shop was in the context of the hiring hall arrangement.

Senator Taft pointed to the case of the maritime industry.

You had the closed shop going hand and hand with the -- with the hiring hall.

However, in enacting the Taft-Hartley amendments, they did not specifically outlaw the hiring hall as such.

Justice Hugo L. Black: Was there any effort made to outlaw?

Mr. Norton J. Come: No, Your Honor.

To my knowledge, there was -- there was not but --

Justice Hugo L. Black: Was there any effort made to make it legal?

Mr. Norton J. Come: Well, let me -- let --

Justice Hugo L. Black: The specific terms.

Mr. Norton J. Come: -- let me tell you what -- what happened.

We have the Taft --

Justice Hugo L. Black: Well, did anybody ever have an amendment in connection with it or did anybody ever have anything for Senate in connection with it?

Mr. Norton J. Come: Well, I -- I'd like to -- to cover that if I may.

You have the 47 situation where Senator Taft talks about the hiring hall going hand and hand with the closed shop and one of the vises that he pointed out about the hiring hall was the employer had no right to select the people who he would employ.

In other words, the employer had had no right to reject.

He had to take whoever the -- the union referred.

Justice Hugo L. Black: Well, did he do that in connection with an amendment where he was going to live the employer with that right --

Mr. Norton J. Come: Well what can you --

Justice Hugo L. Black: -- on hiring hall?

Mr. Norton J. Come: What -- what you had was the amendment of the proviso to 8 (a) (3) which banned the closed shop.

In the next session of Congress, which was in 1949, you had the Thomas Bill which would have restored the closed shop.

And Senator Taft proposed an amendment which would have returned to the Taft-Hartley union shop provision and he tapped on a proviso to that that said that the employer provided however, that the employer should have the right to call upon the union to refer people provided that the employer had the right to reject them because if they didn't have the right to reject then that would be a violation of -- of present law.

That provision passed to Senate but it died in the House.

It was -- it was not enacted.

In the next session in 1950, you had a proposal by Senator Magnusson to authorize the hiring hall in the closed shop in the maritime industry.

That provision was not enacted.

Thereafter, you get nothing until -- to my knowledge until you get to the Landrum-Griffin amendments in 1959 and this is what you get there and I think this is addressed to a question that -- also that Mr. Justice Brennan mentioned.

In 8 (f) of the Landrum-Griffin amendments, Congress gave special treatment to the building trades and in this 8 (f), they provided that it would not be an unfair labor practice for the building trades to enter into so called “free hire agreements,” that is a contract between a union and an employer that would recognize the union as the bargaining agent before any employees had been hired which would ordinarily be an unfair labor practice.

Furthermore, they could provide in that contract without permitting an unfair labor practice that the employees could be required to join the union seven days after employment as distinguished from the 30 days in the 8 (a) (3) proviso.

And furthermore, it would not be unlawful for the employer and the union to incorporate in -- in such an agreement a provision that would require that the union be given an opportunity to refer applicants according to objective criteria such as length of time in the area and things of that sort.

Now, that proposal when it was introduced and was ultimately enacted was criticized on the ground that it would permit hiring hall arrangements without regard to the safeguards that the Board had in its Mountain -- had enunciated in its Mountain Pacific decision.

And when this was enacted, you have a specific provision in the House conference report which is referred to on our briefs that specifically says that nothing in this 8 (f) shall be construed to affect the applicability of the Board's Mountain Pacific decision, citing the decision and the -- and the citation.

Justice Hugo L. Black: What page is that on -- on your brief?

Do you remember?

I don't -- take your time if you take the --

Mr. Norton J. Come: Well, I think I can find it fairly quickly, Your Honor.

It's on Pages 44 and 45 of our brief, footnote 23.

Now, to the best of my recollection, that is the extent of the congressional history of this -- of this problem.

The Board feels that the grant in Section 8 (a) (3) and in Section 8 (b) (2) to prohibit discrimination in employment which tends to encourage union membership is sufficient to enable it to cover a situation such as we have here without a specific provision in the -- in the Act.

This was one of those problems that Congress left to the administrative agency to work out on the basis of its experience as it did with respect to balancing the interest of employers and unions and with respect to no -- the solicitation of union membership and analogous of problems of that sort.

Chief Justice Earl Warren: Where does that leave us, Mr. Come?

Was this -- was this kind of an arrangement for a hiring hall legal and within the scope of collective bargaining prior to the Mountain Pacific case?

Mr. Norton J. Come: I think that the -- that the -- the Board would have probably treated it as -- as legal.

Yes, Your Honor.

But I think that this is one of those problems like with respect to the -- like the Hot Cargo Clause problem for example, where the Board as a result of its continued experience with the problem has decided that they were wrong the first time and the experience has shown that the -- that the hiring hall itself, an exclusive hiring hall I'm talking about, not a -- a non-exclusive one where the employer would be free to -- to hire on his own but an exclusive hiring hall that requires that the employee come through that union hall before he can get a job.

At that standing alone without the safeguards is inherently encouraging to union membership adherence the union rules and at it -- this inference an incur of -- that it has this effect is a reasonable one that the Board was entitled to go out based on its -- on its experience and that the --

Chief Justice Earl Warren: Well, what I'm trying to get at is, is this -- is this a rule that the -- that the Board lays down for us or is this an interpretation that all previous Boards who are wrong and that it always has been illegal to have such -- such kind of arrangements even though they've been recognized and used for many years in the industry, which of the two is it?

Mr. Norton J. Come: I think it represents the Board's judgment that 8 (a) (3) outlaws these arrangements.

Most -- most of them have been operated in conjunction with the closed shop.

It's only been since Taft-Hartley that -- where -- which specifically banned the closed shop that you would get a union reporting to operate a -- a hall without specifically imposing a closed shop and the Board's experience in these cases since Taft-Hartley found that even those cases were relatively few, that most of the cases show that the -- that the hiring hall continued to be operated in conjunction with the -- with the closed shop.

But the Board has determined that whether you can show that it has been operated that way or not standing alone without the safeguards, it violates the Act.

The only thing I'm trying to point out is that although this is the Board's interpretation of 8 (a) (3), it's been the kind of problem that the Board could understandably come to this view only after some experience because it hasn't been the traditional way in which these hiring halls have operated historically and operated as an adjunct of the closed shop.

That part has been kicked out by Taft-Hartley and it's only been since Taft-Hartley that the Board has had to face up to the problem of, "Well, what about the hiring hall standing alone?"

And it has come to the conclusion that that standing alone without the safeguards violates 8 (a) (3) as well as one that would be discriminatorily operated for the reasons I've indicated.

Justice Hugo L. Black: As I understand your answer, it would be means that -- that does not what it means as I like to know.

It means that this contract was interpret to them even as it is without these conditions if the employer had left him set free to accept or not to accept the Board's assignment (Voice Overlap) --

Mr. Norton J. Come: Well, I think -- I think that the contract would have been valid if it had three conditions.

It doesn't have any of the -- of the three conditions that the Board laid down in Mountain Pacific and not only does not leave the employer the right to reject.

It does not provide or posting of the conditions under which the hiring hall are going to be operated so that the employees can see what those objective criteria are and thirdly, they guarantee that the hall was going to be operated without regard to union membership considerations that is set forth in the contract is not an adequate one because it does not cover the period during which seniority status is going to be acquire.

Justice Hugo L. Black: Would the -- would the unfair labor practice are discriminating without this clause if at you say, would be any greater and would if it's in or any greater unfair labor practice if this is in that what if he's out, if the act to discriminate him?

Mr. Norton J. Come: If they actually discriminated, it would not be Justice Black but you have those cases where you may not get the employee complaining to you.

He might have been detoured by -- if the Board is correct by this inherently encouraging system and thereby comply with the union rules and to that extent in that hall area, you would be having a -- an impairment of the -- of the congressional policy here.

Justice Hugo L. Black: Well, is it correct to say that the whole argument that boils down to this if this is a bad practice which inherently bad, it ought not to be allowed, can't the -- Congress has not barred by itself by anything specific, did not acted on it at all as to Board now has acted itself and it is question is whether the Board has the power to do this?

Mr. Norton J. Come: Well, we think that the -- of course the question is whether the Board has the power to do it.

We think that we have a specific grant of authority adequate to handle the problem in 8 (a) (3).

Congress --

Justice Hugo L. Black: Well, is that the one that you never found again until 1958?

Did you -- did you question that and the Board changed any during those days?

Mr. Norton J. Come: Well, yes it did, Your Honor but we also gained experience in the -- in these cases in that time too.

Justice Hugo L. Black: Well, then your man didn't gain much experience, isn't it?

Mr. Norton J. Come: What is that Your Honor?

Justice Hugo L. Black: Well, your man didn't gain much experience from what the others have gained?[Laughter]

Mr. Norton J. Come: Well, you needed awhile for these cases -- cases to build up --

Justice Hugo L. Black: Let me ask you --

Mr. Norton J. Come: We've -- we've tried to list this in appendix to our brief, a sample of the -- of the Board's experience in this -- in this area.

And we submit that the --

Justice Hugo L. Black: But all the experience of the Board up to this time had been the other way, I understood you to say and they hadn't -- hadn't thought it wrong?

Mr. Norton J. Come: Well, I -- I --

Justice Hugo L. Black: With all the members (Voice Overlap) --

Mr. Norton J. Come: -- I also tried to indicate that we had relatively few cases that presented the naked problem.

Most of the cases up until then had been ones where you had had discrimination in addition.

You had the hall operated discriminatorily.

And there were relatively few cases in which you had merely a hiring hall and nothing more and in those cases, you do have an indication that the -- that the Board would not have considered that enough.

But as a result of its further experience with the problem, the Board did change its view but it has only been after considerable experience with the problem that you begin to get cases in the naked form, I mean at least in considerable quantity that you're having them in -- now and that are exhibited in -- in this case.

Chief Justice Earl Warren: How is it -- how is that doctrine being administered Mr. Come?

Is -- are they all automatically banned now and proscribed by the --

Mr. Norton J. Come: No, in -- in --

Chief Justice Earl Warren: -- or do you wait for discrimination in some case -- in cases to take it up?

Mr. Norton J. Come: Well, we have to wait for a charge Your Honor and I mean the Board is not free to -- to act unless -- unless a charge is -- is filed.

As a matter of fact, I --

Chief Justice Earl Warren: There's no way the Board, you know where -- where things of this kind or inherently illegal, there's no way that the Board can -- can get into the case?

Mr. Norton J. Come: That is correct, Your Honor.

As for that reason that the Board has tried to engage in prevented medicine as it were by enunciating what the standards are which they believe would cure the illegal encouragement in the hiring hall problem.

And I further believe that most of the unions have conformed their contracts to the -- to the Mountain Pacific requirements.

Thank you Your Honor.

Chief Justice Earl Warren: Mr. Thatcher.

Rebuttal of Herbert S. Thatcher

Mr. Herbert S. Thatcher: If -- if they did so Your Honor, it was under threat of having to return all dues in the -- initiations fees collected during the period of the unlawful referral, so I don't think that denotes its union acceptance for the Board's proposition at all.

I think the more one listens to the Board's argument here, the more obvious it becomes that the Board is trying to do Congress' job.

I'll just read two excerpts from legislative history.

Here is Senator Taft's in answer to the Thomas Bill of 1959 on page 23 of our brief.

He states, “In order to make clear the real intention of Congress, it should be clearly stated that the hiring hall is not necessarily illegal.

The employer should be able to make a contract with union as an employment agency.

Neither the law nor the decisions forbid hiring halls, even hiring halls operated by -- operated by unions so long as they are not so operated as to create a closed shop.”

Then in 1959 was the Landrum-Griffin, this is on page 4 of the brief for petitioners in the following case, Number 68, and commenting upon the hiring hall provisions of the Landrum-Griffin Section, 8 (f) ongoing construction.

This is both the Senate and the House reports.

“These provisions are not intended to diminish the right of labor organizations and employers to establish an exclusive referral system of the type permitted under existing law.”

This Court, I'm afraid will have to determine what is existing law.

At that time, the law was that they were legal under Mountain -- under all decisions prior to Mountain Pacific.

Thank you Your Honor.

Justice Hugo L. Black: Up to the time of the Mountain Pacific case, had there been anything court that it indicated that this kind of contract would be illegal?

Mr. Herbert S. Thatcher: None.

On the contrary, all courts affirmed the validity and required the Board to make a positive proof of discrimination.

Justice Hugo L. Black: How did this method of determination -- how was it suggested first to the Board, does the record show?

Was it in the brief or what was it in?

Mr. Herbert S. Thatcher: I think it's -- in what Your Honor have mentioned a minute ago, they changed in personnel.

Justice Hugo L. Black: There was -- it must have been something that preceded the Board's finding in the way of an argument, was it not?

Was it?

Mr. Herbert S. Thatcher: There wasn't any --

Justice Hugo L. Black: The brief?

Mr. Herbert S. Thatcher: -- nothing in --

Justice Hugo L. Black: How had the examiner decide it?

Mr. Herbert S. Thatcher: The examiner had decided along the line of the -- well, the Board decided that the -- the charges were in the line of the Board's new theory.

The trial examiner rejected the Board's -- the -- the general counsel's theory and decided in -- in line of the previous decisions, all which upheld --

Justice Hugo L. Black: Was this proposed in by the general counsel?

Mr. Herbert S. Thatcher: This was a general counsel proposal.

Justice Hugo L. Black: That's why it originated?

Mr. Herbert S. Thatcher: That's -- or must have originated there under the charges in Mountain Pacific specifically.

Thank you.