CATERPILLAR, INC. v. INTERNATIONAL UNION, UNITED AUTOMOBILE, AEROSPACE AND AGRICULTURAL IMPLEMENT WORKERS OF AMERICA
United Auto Workers and Caterpillar, Inc. were involved in a working agreement that provided for employees of Caterpillar, Inc. to devote part of their time to processing employee grievances on behalf of the union, while still maintaining full-time employment status and benefits. This agreement was eventually expanded to allow employees to continue receiving benefits from Caterpillar while working full time for the union. In 1991, Caterpillar refused to continue paying benefits to workers who were not directly providing services for the company. The union filed with the National Labor Relations Board (NLRB) asserting that Caterpillar was engaging in unfair labor practices. Caterpillar claimed that the benefit payments violated section 302 of the Labor Management Relations Act (LMRA). Both the NLRB and the District Court found that the payments did in fact violate Section 302 of the LMRA.
On appeal, the U.S. Court of Appeals for the Third Circuit reversed and ruled for the union. The Third Circuit found that Congress had not intended the LMRA to ban the type of payments at issue. Then-Judge Samuel Alito dissented, arguing that the payments were illegal under the plain meaning of the legislation.
Does an employer who grants paid leave of absence to employees who then go to work as a union's full-time grievance chairmen violate Section 302 of the Labor Management Relations Act?
After the Supreme Court heard oral arguments, but before it ruled, the Union reached a settlement with Caterpillar rendering the case moot.
Argument of Columbus R. Gangemi
Chief Justice Rehnquist: We'll hear argument now in Number 96-1925, Caterpillar, Inc. v. International Union, United Automobile, Aerospace and Agricultural Implement Workers of America.
Mr. Gangemi: Mr. Chief Justice, and may it please the Court:
The issue for consideration, in a nutshell, is whether it is lawful for an employer and a union to agree that the employer shall pay the wages of a union official, or union officials, for their services as union officials, where the union official used to be an employee of the payor employer.
Our position is, is that under section 302 of the Labor Management Relations Act and a fair reading of the plain language of that statute, such an arrangement is clearly unlawful.
This Court in Arroyo many years ago said that a literal reading of the language of the statute does no offense... does no violence, I believe the term was... to common sense and so I believe it is useful at the threshold to consider for a moment what common sense would suggest is the answer to the question in light of what we all know to be bedrock Federal labor policy and that is, is that notwithstanding the fact that ultimately there is an economic interdependence between labor and management, that the relationship is to be maintained as one of adversarial independence.
In light of that fundamental policy that has been expressed by this Court on numerous occasions, from insurance agents on forward, to ask the question, is it lawful for an employer to pay a union official for his services as a union official is to answer the question.
Unknown Speaker: Well, let me ask you this, Mr. Gangemi, do you think the wage payments would be lawful if the employees actually worked for the employer an hour a day and the rest of the time for the union?
Mr. Gangemi: I believe that the statute provides that an employer may pay for the services of that individual as an employee, but may not pay--
Unknown Speaker: For the hour a day.
Mr. Gangemi: --For the hour that he works as an employee of the employer, but for the--
Unknown Speaker: So on the no-docking arrangements, you think a fortiori they would be invalid, where there's been full pay but only part work for the employer.
Mr. Gangemi: --No, Your Honor.
Unknown Speaker: No?
Mr. Gangemi: I believe that to understand whether or not a payment is lawful under a no-docking arrangement one must go to the safe harbor language of the 8 (a)(2) proviso of the National Labor Relations Act, which is from whence the no-docking provision gets its genesis.
That language, that section says that notwithstanding anything else, it... an employer shall not be prohibited from permitting an employee to confer with him during regular hours without loss of pay.
Unknown Speaker: That isn't all... that isn't all that a shop steward does, unfortunately.
I mean, if you're appealing to plain language, that would allow the shop steward to be paid only for the time that he spends conferring with the employer and not with consulting the employees who have grievances, and so forth.
Mr. Gangemi: The board and the courts have extended that language, rightly or wrongly, to include conferring with each other, conferring with fellow employees, in preparation for or in conjunction with conferring with management.
Unknown Speaker: Okay.
What about a full-time shop steward?
He spends his full time--
Mr. Gangemi: If--
Unknown Speaker: --conferring with other employees and with the employer.
Mr. Gangemi: --Again, Your Honor, it depends on the nature of the relationship.
If a steward has ceased to be an employee of the employer and instead become a full-time agent, or to the extent that he is acting as an officer of the union--
Unknown Speaker: I don't know what you mean, to the extent that he's acting as an officer.
He spends his full time on union work.
Mr. Gangemi: --Your Honor, I do not think the distinction is one of full-time versus part-time.
I think the distinction is, is he being paid for his services as a union official, which is unlawful, or is he being paid for his services as an employee, which is lawful.
Unknown Speaker: But that's not the... I mean, you acknowledge that if he's conferring with the employer on a grievance, that isn't spending his time as an employee of the employer.
That's spending his time as a union member, isn't it, and you concede that that is payable.
Mr. Gangemi: Section 8, the proviso... Your Honor, the proviso to section 8 (a)(2) creates, in our view, a safe harbor--
Unknown Speaker: And all I'm asking you--
Mr. Gangemi: --which allows this type of conflict.
Unknown Speaker: --All I'm asking you is, how wide is the harbor?
Is it enough that the steward does nonunion work for an hour, a half-hour, 15 minutes a day?
Mr. Gangemi: Again, Your Honor, in our judgment the distinction is not the issue... the issue is not whether the individual works full-time or part-time.
If you look at the statutory language, it says nothing about whether someone is full-time or part-time.
A full-time union agent could not fall within the ambit of the 8 (a)(2) proviso--
Unknown Speaker: Well, it depends on whether he's an employee, you say--
Mr. Gangemi: --Because he would no longer be an employee.
Unknown Speaker: --Is it enough to make him an employee that he works for the employer 15 minutes a day?
Mr. Gangemi: Your Honor, I do not think so.
I do not think that working for a few moments a day for an employer--
Unknown Speaker: Okay.
What is the line you're drawing, because I... I frankly... I think it's in my view crucial to your case that the no-docking rules are not cast aside, and the Government has really portrayed your argument as an attack upon that.
You say it's not an attack upon that.
Mr. Gangemi: --That's--
Unknown Speaker: I want to know how much of the nodocking law remains.
The majority of the employee's time has to be for the employer and he ceases to be an employee if he's not spending most of his time for the employer as opposed to the union?
Mr. Gangemi: --I do not think that section 8(a)(2) proviso is a matter of the amount of time.
I believe, and we argue, that it is a function of the nature of the activity that the representative of the union, the employee, is engaging in.
Unknown Speaker: He's engaging in two types of activities.
Some of it is for the employer, and some of it is as a shop steward, which is not for the employer, okay.
He's doing both.
Mr. Gangemi: The analysis would be--
Unknown Speaker: And your answer is?
Mr. Gangemi: --My answer is, is that you go to the statutory language--
Unknown Speaker: Right.
Mr. Gangemi: --And under 302(c)(1) he cannot be paid for his services as a union representative.
He may be paid for his services as an employee of the employer in a dual capacity situation, unless... unless--
Unknown Speaker: Yes?
Mr. Gangemi: --You then go to section 8(a)(2) and if the nature of the activity falls within the ambit of 8(a)(2), then Congress has allowed a safe harbor for that conduct.
Unknown Speaker: Even if all his time is spent on that?
Mr. Gangemi: Even if all his time is spent on that, if it falls within the ambit of section 8(a)(2).
So, for example, Your Honor--
Unknown Speaker: Yes, I must say you're not being helpful to me on... really on my main... on my main concern.
You're saying it depends on whether he's really an employee of the employer or an employee of the union.
I have no idea how to answer that question.
Mr. Gangemi: --Well, Your Honor, I--
Unknown Speaker: He's spending all his time as a shop steward and you say you cannot tell me whether that makes him an employee of the employer or of the union.
Mr. Gangemi: --If an individual is spending all of his time and has ceased to... has ceased to engage in activity on behalf of the employer, he is--
Unknown Speaker: Okay.
Mr. Gangemi: --no longer controlled by the employer and doesn't meet the control test.
Unknown Speaker: Good, and the next question is 15 minutes.
He works 15 minutes.
Mr. Gangemi: To the extent that he works 15 minutes for the employer--
Unknown Speaker: He is an employee.
Mr. Gangemi: --He is an employee for those 15 minutes.
Unknown Speaker: And will the no-docking provision apply to all the rest of his time?
Mr. Gangemi: Not in my judgment, because with regard to the remainder of that day, what you're positing here is a situation where you have a dual capacity employee.
He is a agent of the union, similar to the case in Town & Country, and he is an agent of the employer.
He's an employee of the employer.
In that situation, 302(c)(1) is clear.
It sets up a dichotomy.
It says that it is lawful to pay a union official to be an employee of the employer but it is not lawful to pay a employee of the employer to be a union official with the very limited proviso that if you can fit the conduct, if you can fit the nature of the activity, regardless of how many hours, Justice Scalia, within the confines... and they're very narrow confines.
The harbor of 8(a)(2) is very narrow.
Unknown Speaker: Can you be concrete, then, about what is this conduct, because you seem to be dividing it up not on the basis of number of hours, but conduct, and let me give you a specific example.
Let's take the job of grievance settlor, and instead of giving it to one person who's called the chairman to do it full-time, it's given to two shop stewards, each one working 4 hours a day at that job and 4 hours a day at the plant job.
Is that arrangement... shop steward works 4 hours at the plant, 4 hours settling grievances, two of them, so it adds up to a total of 8 hours a day, are those two shop stewards legitimately within the no-docking exception that you derive from section 8(a)?
Mr. Gangemi: Well, those were the facts in the BASF case, where an individual was a part-time, albeit regular union official.
He was not just representing his fellow employees on an as-needed basis in connection with particular grievances.
He was performing regular representational functions, albeit 4 hours a day.
The provision in the contract said that the employer could pay for reasonable time spent in representation of employees up to 4 hours a day, and what BASF was complaining about, as I understood the facts, is that this had become de rigueur, that every day, day-in and day-out, this was... this individual had become a regular, albeit part-time union official, and the BASF felt that under the terms of that... and I agree with BASF in this regard.
I disagree with the Second Circuit in this regard, that under... that where that individual has ceased to be a shop steward merely conferring with the employer considering grievances on an as-needed basis, and thus fits neatly within the ambit of the 8(a)(2) proviso, when the representation becomes a regular full... part-time, albeit part-time representation--
Unknown Speaker: Well, that's where--
Mr. Gangemi: --then it's prohibited to pay that individual.
Unknown Speaker: --That's where I'm not following your argument, because we're talking about parties bargaining for a contract, so I'd like to know the contract term for which the union and the employer can bargain, the nodocking contract term--
Mr. Gangemi: I under--
Unknown Speaker: --that you would say is legitimate, and you can't do it on the basis of, well, when it becomes--
Mr. Gangemi: --I think this case gives a perfect example and I direct the Court's attention to pages 4 and 5 of our reply brief, where we reproduce the two provisions.
One of them is a no-docking provision in the labor contract that we do not think is at issue and we think it is perfectly lawful under the 8(a)(2) proviso and the other one is 4.6, which we do not believe is a nodocking provision and we do not believe is lawful.
The 2.2 says, Your Honor, stewards may--
Unknown Speaker: --Where are you reading from, Mr. Gangemi?
Mr. Gangemi: --I am reading from pages 4 and 5 of the reply brief.
Unknown Speaker: Whereabouts on page 4?
Mr. Gangemi: Well, also I can direct your attention, Your Honor--
Unknown Speaker: Well, you've refer... if you'd just tell us where in the reply--
Mr. Gangemi: --It's the middle.
Unknown Speaker: --The middle of page 4.
Go ahead, rather than... well, we'll find it.
Mr. Gangemi: I had that in my notes.
I am reading now from the middle of page 4, the quotation.
Unknown Speaker: Thank you.
Mr. Gangemi: In short, that says... and that's a no-docking provision, 2.2 of the local agreement.
Stewards may, without loss in pay for regularly scheduled hours, discuss a grievance with the aggrieved employer, provided the aggrieved employ--
Unknown Speaker: Employee, not employer.
Mr. Gangemi: --With the aggrieved employee.
I'm sorry, Your Honor.
Provided the aggrieved employee first informs his immediate supervisor and also with the employee's supervisor and, if the grievance is not satisfactorily settled, with the plant grievance committeeman.
That is a classic no-docking clause.
Unknown Speaker: And you concede that that's okay.
Mr. Gangemi: Absolutely, Your Honor.
Unknown Speaker: Even though I assume a particular steward might spend his entire time doing that.
Mr. Gangemi: On a given day, Your Honor, it might be the case that he would spend a full day--
Unknown Speaker: There's no exclusion if he spent his whole year doing that.
I mean, maybe the union wants to economize on stewards, so it only has one steward for the whole plant.
Mr. Gangemi: --Shop stewards have regular jobs and regular job duties.
Shop stewards have a regular function that they perform in the factory which they come off of and they return to upon the completion of their task.
For example, if the 2.2 provision doesn't ring true to Your Honor in terms of the distinction, take a look at the 1950 Department of Labor sample that is cited in appellee's brief, or respondent's brief, I should say, as a sample of a classic no-docking clause.
Unknown Speaker: Where is this?
Mr. Gangemi: --It is in the--
Unknown Speaker: Do they quote it, or do they just cite it?
Mr. Gangemi: --They just cite it.
Unknown Speaker: Oh, okay.
Mr. Gangemi: So I do not have it, but I am reading from the 1950 BLS bulletin.
Quote, It is understood... this is a sample clause that the Government is giving as an example of the no-docking provision.
It is understood that stewards and grievance committeemen are employed by the company to perform fulltime production and maintenance work, but it is further understood and agreed that they may take time off during their regular working hours and be paid at their regular rate of pay to perform... and then it lists investigate and present grievances, attend meetings for the discussion of matters arising out of the application of the agreement.
It's an example of what a no-docking provision is.
Now, Justice Scalia, this may be a matter... ultimately a matter of degree, but matters of degree are as real in the law as matters of qualitative distinction.
I believe that that type of provision is qualitatively different from the 4.6 that is at issue here wherein the employer and the company... the employer and the union agree that the chairman shall conduct his business from the local union office, he shall be considered on leave of absence, and he will be paid by the company for his regular shift hours.
However, the company shall not pay for time spent, and then it lists a couple of exceptions, activities not directly related to the functions of his office.
In other words, this individual is not a regular worker in the plant, not a real employee, to use your terminology.
Unknown Speaker: Can they negotiate legitimately for any retention of any benefits for someone selected from among the employees to do this job for a term?
For example, how about retaining the right to return to work, the seniority provision... are there any benefits connected with employment that are retained, or can be bargained for to be retained?
Mr. Gangemi: I believe... it depends on what you mean by the word retain, Your Honor, but I believe that one can retain the rights that have already accrued to that person while they were an employee.
For example, the pension that has been earned to the date that he ceases to be an employee and becomes a union agent.
He can retain them, and he can draw down on them.
He can be paid out--
Unknown Speaker: But not accrue any more.
Mr. Gangemi: --He cannot accrue any more.
Seniority, or the right of seniority it seems to me is nothing more than holding the place in the queue.
It is not a payment of money or a thing of value to a union official.
Unknown Speaker: You pay him when he goes--
Mr. Gangemi: It is only of value if the union official comes back and becomes again at some point in the future an employee.
Unknown Speaker: --You pay him when he goes on vacation.
Mr. Gangemi: Excuse me?
Unknown Speaker: You pay him when he goes on vacation.
Mr. Gangemi: In this case?
Unknown Speaker: I mean, employees are paid all the time when they go on vacation.
Mr. Gangemi: Ah--
Unknown Speaker: And if they're hurt, they get compensation.
Mr. Gangemi: --This is the--
Unknown Speaker: And if they're permanently crippled they get compensation and their health benefits continue, and all kinds of things continue.
What's the difference between that and this same person who works for both taking a year off to handle grievances?
What is the difference?
I'm not saying there isn't one.
Mr. Gangemi: --I will... I will--
Unknown Speaker: I just want to know the implications there.
Mr. Gangemi: --It's an important question and the bottom line is, is that this is the argument that there are various types of contingent benefits for... that are paid to an employee for time not worked.
Unknown Speaker: To put all the cards out, so to speak, I mean, you're willing to let them do that when it's 15 minutes as a shop steward talking to the immediate supervisor.
You're willing to let that happen when it's a plant committeeman, a grievance committeeman, I take it, talking to his counterpart the... slightly higher up in the employer's hierarchy.
I don't know if you're willing to do it when he's actually even higher up and talks to... but it seems like sometimes you're willing to see it that way, sometimes not.
Mr. Gangemi: Well--
Unknown Speaker: But go back to the first.
Mr. Gangemi: --Let me go back to the first one for a moment.
The difference between other paid time off provisions and this one is, simply speaking, the statute.
There is no statute that prohibits an employer from paying someone to go on sabbatical.
There is no statute that prohibits an employer for paying someone to go on political--
Unknown Speaker: In each instance, I'm assuming there is a person who has a dual capacity.
That is, he works for the employer, but he's also a union rep.
Mr. Gangemi: --Well, or he... or in this case he used to work for the employer.
Unknown Speaker: Yes, so the statute applies.
The question would be, is the payment by reason of his employer service?
Is it by reason of, those are the key words, by reason of and if it's not, of course, I get--
Mr. Gangemi: Well, and the phrase by reason of, Your Honor, is nothing more than a prepositional phrase.
The important issue is what is the object that that prepositional phrase takes, and the object, reading the literal language, is service as an employee, or his service as an employee of the employer.
Unknown Speaker: --Well, let me ask you this.
Can it be said that the employer derives any benefit from the work done by the employee for the union?
Mr. Gangemi: I do not believe, and I believe the court below recognized, that there is anything but a theoretical benefit that the employer derives from these individuals.
These individuals work--
Unknown Speaker: It's enough to be by reason of.
Mr. Gangemi: --Pardon?
Unknown Speaker: The benefit, theoretical though it may be, is on your view, I take it, enough to qualify as a payment by reason of.
Mr. Gangemi: I thought Her Honor's question went to a benefit that the employer receives from a grievance administration.
Unknown Speaker: I asked whether the employer could be said to receive any benefit from the work done by the employee for the union.
Mr. Gangemi: In our judgment that's... in theory that may be the case, but it is irrelevant if it is the case.
The individual... and it was found by the district court and it was confirmed by the appellate court... is working solely and exclusively for the benefit of the union.
Now, that there may be some indirect tangential benefit to the employer, theoretical or otherwise, does not mean that that person is working for the benefit of the employer.
Likewise, that individual is not subject to the control of the employer and the record is clear below that everyone who has looked at this situation, the district court, the appellate court, and the administrative law judge, found that these individuals are no longer employees of the employer and have become employees of the union by virtue of the classic test for that, control and benefit.
Unknown Speaker: Yes, but to the extent that the employee is being paid on a no-docking scheme the same argument can be made with respect to the period covered by the no-docking rule, can't it?
I mean, it seems to me that your... I understand your argument, but I don't see why your argument, if we accept it, does not force us to say that the no-docking rule is prohibited.
Mr. Gangemi: Because, Your Honor, Congress has dealt with that for you.
Let us assume for the sake of argument that that... it has created a safe harbor.
Unknown Speaker: Well, it hasn't done so in terms of plain language.
I mean, it really hasn't.
So I don't know how the argument flows.
Mr. Gangemi: Well, Your Honor, I mean, we may... we may disagree with regard to the plain language.
I think 8(a)(2) has very plain language.
But in passing a... but if you do not think the language is plain and you wish to go to the legislative history, then go to the legislative history and you will find that in 1935 it was proposed that the language have within it an exception allowing employers to pay, quote, local union representatives and--
Unknown Speaker: I was... I just want to go back, can I, to my question, because I think if you answer it directly you will get a conceptual distinction that will help you.
I'm not... but I'm thinking of an employee, and the employee is a union representative as well, so when the employer writes a check he is paying money to a representative of one of his employees, all right, so he fits in the statute and it also happens to be his employee, all right?
He's a representative of the union.
He's also his employee.
Now, that person is disabled and so health benefits, vacation benefits, money checks flow to that person who is the representative of the employee for many years into the future.
That's fine, isn't it?
That is not, in your view, money paid by reason of.
That is money paid by reason of.
Mr. Gangemi: --Exactly.
Unknown Speaker: Now tell me why that is money paid by reason of, why the docking is... no-docking is money paid by reason of, but the payment to the man who takes the year off to be the grievance committee chairman is not money paid by reason of.
If you could explain that very clearly, I think I would understand how you're trying to make the distinction.
Mr. Gangemi: Your Honor, the money paid to a former employee who is... again, let's say had a workplace injury and is on disability and is entitled, by virtue of his disability, to compensation, can be paid that compensation notwithstanding the fact that he has now become a union official, because it was... he was entitled to it by virtue of, by reason of his service as an employee of the employer.
Unknown Speaker: Just like the grievance committee chairman is here.
Mr. Gangemi: For his services as an employee of the employer?
Unknown Speaker: Yes.
That's why the employ... the employer would never pay him if he weren't also an employee of the employer.
Mr. Gangemi: Pay him for what?
Unknown Speaker: For all the things he's done in the past to earn this year to go up and--
Mr. Gangemi: I--
Unknown Speaker: --All right.
Now, I'm not... I'm not taking the position.
I want to see what your response is.
Mr. Gangemi: --My response is, is the district court's response, Your Honor.
The record here is devoid of any evidence that the chairman's wages for services rendered are for services rendered while he was employed at Caterpillar, appendix petition 61.
The Third Circuit, the chairman does nothing for Caterpillar.
The payments at issue here do not relate back to these former employee services on the shop floor, page 8 of the petition... appendix to the petition.
It is difficult to, indeed, to comprehend how years and even decades of paid union leave can realistically be thought of as compensation for time spent on the factory floor.
Unknown Speaker: On the difficulty... on the difficulty of comprehending that, you were about to say if the statute is ambiguous, and legislative history, does it count for anything that for decades in the industry, it appeared, this kind of arrangement was accepted.
For... one of the startling things about this case is that you are coming forward and now saying that for nearly 20 years your client has been engaged in a felonious course.
Mr. Gangemi: --Well, first of all, Your Honor, it is not a wide industry practice.
There is no evidence here that it is widespread in anything but the auto industry, number 1.
Unknown Speaker: But this particular employer has been doing it for nearly 20 years, right?
Mr. Gangemi: This particular employer entered into this arrangement in 1973 under threat of strike and has had it for five or six contract terms, that's correct, Your Honor, but I think--
Unknown Speaker: There must have been some kind of judgment that it was legal.
Mr. Gangemi: --I think that's an untoward assumption, that... or an unjustified assumption, I should say, Your Honor.
It is very easy to be lulled into a belief that, you know, if you pay a part-timer, or if you pay a shop steward, you should be able to pay a regular union rep, too.
That's easy to fall into that, to be lulled into that sense that there is no difference when in fact there is.
And then one day you wake up and the union is demanding that full-time union agents be paid full-time pay at 54 hours a week, at top rates and shift premiums, because it's time they got a raise.
Unknown Speaker: I guess we should--
Mr. Gangemi: These are slippery slopes, Your Honor and I don't think that the fact that we have slid down it necessitates that we stay at the bottom.
Unknown Speaker: --I guess we should not reject virtue even if it comes late.
Is that your argument here?
Mr. Gangemi: Virtue is virtue, Your Honor.
I would like to... with the Court's permission I'd like to reserve the balance of my time for rebuttal.
Unknown Speaker: Very well, Mr. Gangemi.
Mr. Silberman, we'll hear from you.
Argument of David Silberman
Mr. Silberman: Thank you, Mr. Chief Justice, and may it please the Court:
Discussion to this point I think has made quite clear that there is no principle basis for distinguishing a collective bargaining agreement that provides an employee who assumes a union position part time off to perform those duties from one that provides full time off, and--
Unknown Speaker: Well, one principle I think has been suggested.
It didn't get very far in the argument here but at least, as I understand it, this principle was suggested, that in fact the language in, what is it, (c)(1) was in fact added in an effort to in effect equalize the position of those who are working for an affiliated union and an unaffiliated union.
But the point was to allow, how ill-defined it may have been, some no-docking practice for all of them.
Whatever that means, and however facially inconsistent that might be with the general prohibition, it was at least something less than 100 percent of one's time and a payment of 100 percent of one's salary for that time and that, at least on the basis of legislative intent, in construing an ill-drafted statute we should recognize the basic distinction between no docking for some work and full payment for no work for the employer.
What about that distinction?
Mr. Silberman: --Well, Justice Souter, first, as a historical matter, at the time the statute was enacted there was as much evidence of no... of payment of the type we had here, where it was recognized that an employee would have full time off to perform certain union functions, representational functions, as part-time positions.
Unknown Speaker: Can I find that in the record?
Mr. Silberman: You can find that in our brief.
We cite the... we would begin by reviewing the 1941 Ford contract with the UAW--
Unknown Speaker: Yes.
Mr. Silberman: --which is the agreement.
We quote that, which expressly provides that a full-time position--
Unknown Speaker: You're talking about this industry.
You're not talking about economy-wide.
You're talking about the automotive industry.
Mr. Silberman: --It was... the automotive industry... historically, Justice Scalia, it was... the industrial unions began in the automotive industry, so this was certainly the lead industry.
Unknown Speaker: Yes.
Mr. Silberman: And this was specific... this industry's practice was specifically called to the attention of the 1947 Congress, both the Ford contract, which was a de jure full-time contract and the Chrysler contract which, as we explained in our brief, was de facto full time in that employees were given as much time as they needed and, in fact, the chief steward spent full time.
Unknown Speaker: What is the significance of having these practices 1947 Congress?
Mr. Silberman: Well, Chief Justice Rehnquist, I was... I thought I understood Justice Souter to be suggesting that a distinction could be drawn between part time and full time based on historical practice, and that you could understand the statute as only going as far as history had taken it, and I'm suggesting that that doesn't provide a basis for distinction.
Obviously, the ultimate answer to the question here is going to turn on the language and structure of this statute as informed by its history.
Unknown Speaker: You can draw a distinction based on the language of the statute.
I mean, it has to... are your people employees or former employees, in your view?
Mr. Silberman: They are employees, Justice Stevens.
Unknown Speaker: The ones who work full time at the union get no pay... do no services whatsoever for the company for 5 years in a row.
They're employees of the company.
Mr. Silberman: They... although we would say nothing turns on that in terms of interpreting this statute, we think the correct analytic answer is that they are employees, and they are employees for the same reason that an employee who is on leave to take an educational... pursue a college education or is on sabbatical, that the statute defines employee for the purpose of 302 it's the same definition as for the purpose of NRA.
The labor board law since 1935 on has been very clear that an employee who is on leave, as long as he still has some right to return and hasn't severed all employment ties, continues to have the status as an employee.
He can't be discriminated against, et cetera.
So we think if anything turned on it these people are employees, but since the statute here is written in the disjunctive and allows payments either to employees--
Unknown Speaker: Yes.
Mr. Silberman: --or to current employees, I--
Unknown Speaker: But your theory is there, your theory is they are current employees even though the company has no control over their--
Mr. Silberman: --That's right.
We would not say they are currently rendering service to the employer as an employee, but if the question is, do they have the status of an employee, you would answer that in the affirmative.
But as I say, whether they are employees or former employees, we turn to this statutory language and the statutory structure to understand the structure--
Unknown Speaker: --But the point wouldn't be whether they're an employee.
What is crucial is whether these... whether the company is paying them as compensation for his service as an employee, and do you think that the money that the company is paying while he's on leave is compensation for his service as an employee?
Mr. Silberman: --I would say, Justice... the statute is compensation for or by reason of his service as an employee.
Unknown Speaker: Oh.
You say, you think it's by reason of his service as an employee?
Mr. Silberman: I think it is at the very least that.
Unknown Speaker: If everybody got paid leave to do whatever they want, then I would agree with you, but this is a... but that is not the rule here.
I assume everybody in this company can't just go off on leave and continue to draw his pay.
Mr. Silberman: --That's--
Unknown Speaker: This fellow gets his pay only because he's working for the union.
Mr. Silberman: --Well--
Unknown Speaker: How can you say that he's being compensated by reason of his service as an employee.
Mr. Silberman: --Well, he's not getting pay only because he's working for the union.
There are two preconditions, Justice Scalia.
The first is, of course, that he has... he is an employee, has rendered service as an employee, and then this is a form of contingent leave.
He's... as an employee the employees are entitled to paid leave under certain contingencies.
As Justice Breyer pointed out, if they become disabled, if they're called for military services and, in this case, if they assume a union position they are entitled to a paid leave, and we would say that that payment is payment by reason of service as an employee just as, in the Bingler case in the tax context, this Court had no trouble saying that an employee who was on full-time leave to pursue a degree, and he's drawing pay from his employer, was getting that pay by reason of his service as an employee.
Unknown Speaker: No, but what that boils down to saying is, he gets it simply because the only people they have contracted to pay it to are those who have the status of employee and therefore the entire issue becomes one of whether the employer has, in fact, recognized this as something it would like or is willing to do to an employee, and that's the substance of it.
Mr. Silberman: I think, Justice Souter, that is essentially right, subject to--
Unknown Speaker: Then there's nothing left of the prohibition.
No, I think that's... I don't think that is fair.
There's nothing... the prohibition, the broad prohibition is a prohibition on payments of money to union officials.
It was an antibribery prohibition.
There is in... we do think that 302(c)(1) is a very broad exception and we suggest to the Court that it be contrasted with the exceptions stated in subsections (c)(4) and (c)(5).
(c)(4) deals with withholding of union dues and Congress there laid down a very specific set of rules and subrules as to when, under what circumstances those kinds of payments should be lawful and when they should be unlawful.
But it seems to me... you talk about a broad exception, and if the collective bargaining agreement provided... it listed all the people who have ever had a job with the union, the president of the union on down, and said they all should be employed in the company from January 1 to January 3.
Thereafter, they should be put on leave and remain on leave as long as they want to stay and do everything... and as long as they do something for the union that has helped in the collective bargaining negotiations the exception would apply.
Mr. Silberman: --I think not quite... I would not take it that far, Justice Stevens.
In Arroyo this Court made clear that there is a point at which a payment which in form satisfies one of the exceptions, satisfies part of (c), subsection (c), nonetheless can be illegal, if it's a sham, if it's really an attempt... if it's really an attempt not to further a legitimate purpose but to line the pockets of particular union representatives, and if what you're positing is a collective bargaining agreement which they know--
Unknown Speaker: Not to line their pockets, just pay them enough so they'd be a little more friendly during collective bargaining negotiations.
Mr. Silberman: --Well, I... if what you're positing is an agreement... a negotiation in which they... in which what is said is that Jones is going to get some additional money, we want to keep Jones happy, I think that would fall outside of... that would fall within the sham exception.
It would fall outside section (c)(1).
That is not--
Unknown Speaker: It seems to me this program wants to make a lot of union officials happy.
Mr. Silberman: --I don't think that's quite accurate, Justice Stevens.
When the union comes to the bargaining table it's not bargaining for pay for any particular individuals.
Unknown Speaker: Isn't this demand for 54 hours wages, isn't that pay for the union officials?
Mr. Silberman: It is pay for particular positions, not for particular... to be filled--
Unknown Speaker: Particular union positions.
Mr. Silberman: --Union positions to be filled not necessarily by the individuals who are negotiating, to be filled by people... to be filled by union... the people elected by the employees.
Unknown Speaker: Yes, but it doesn't really matter because they're not getting this money for being union officials.
They're getting this money because they used to be employees, so we shouldn't be so suspicious about it.
They're not really getting the money for being union officials.
They're getting it because they used to be company employees.
That's why they want the raise.
I don't understand that.
It seems to me that if the statute meant what you want it to mean, it would... instead of having that exception in (c)(1) it would be easier to say in (a)(1) to any representative of any of his employees who are employed in an industry affecting commerce except such representatives as are former employees of the employer himself.
That would have done the trick.
We wouldn't have all this argument.
It would be a lot clearer.
Mr. Silberman: That may well have been a clearer way to write the statute, Justice Scalia.
it would not have, however, allowed for the possibility... Congress clearly wanted... the difference in language as it now stands is that a situation in which an employer makes a side deal with one of... somebody who used to be one of his employees having nothing to do with the fact that he is... is or was an employee... he says, look, you come to the negotiating table with me.
Here's some money.
That's still illegal under the statute as drafted.
It would not be illegal under the statute you posit, so that the structure that's... that Congress did seize upon does allow for the possibility that if payments are made that are... where the employment status is an irrelevancy, it's a convenience, but it's an artifice, those could be condemned.
Unknown Speaker: Why can't you use those words to apply to this very situation?
Isn't the former employment status just a convenience for the people who the union wants to run the union affairs?
Mr. Silberman: I don't think so at all, Justice Stevens.
I think in part the employer would not have done this but for the fact these are employees.
What this... what this practice is about, and 60 years of experience tells us, this practice is about trying to create a system of workplace representation where people who come from the plant, who know the plant and know the players, know the practices, will be able to step into positions of workplace representation.
It's not irrelevant that they were... that they served as employees or serve as employees.
It's central to this... what this system was about.
Unknown Speaker: Of course, they can do the best negotiating, too, as the... I don't understand that argument.
I really don't.
It seems to me that's... you're just describing what makes a good union negotiator, or a good union arbitrator, experience in the plant and experience in the company, but... and you're saying that the company shall pay for all of this.
Mr. Silberman: Saying that this is what... how this system evolved, and it was very well-evolved at the time the statute was written, that there is no evidence at all that there was... that anybody in Congress thought the system as it has evolved, which was no different than it is today, was corrupt, was illicit, should be criminalized.
Unknown Speaker: May I ask you another fact question I didn't find in the briefs?
Are these full-time union people paid... is their entire compensation derived from the company or is part of it supplemented by the union?
Mr. Silberman: Insofar... these, quote, full-time people are not--
Unknown Speaker: The most senior people in the union that we're talking about.
Mr. Silberman: --Right.
They are not entitled to pay for certain kinds... they're only entitled to pay from the company for performing the duties--
Unknown Speaker: No, my question is, do they get their entire income from the company or is their company pay supplemented by the union?
Mr. Silberman: --And I... there's not... what I want to say is that there are times when they are... they're only paid for certain functions, and when they stop doing those functions--
Unknown Speaker: It would help me if you'd answer that yes, no, or sometimes.
Mr. Silberman: --I'm--
Unknown Speaker: Answer the question and then explain.
Mr. Silberman: --I'm not... I suppose, as... if those are the two choices, the answer is they're supplemented from the company.
Unknown Speaker: You have three choices, yes, no, or sometimes.
Mr. Silberman: Sometimes, then.
In the sense that there are certain functions for which they are not paid by the company.
They are paid for those functions by the union.
It's not the case, and why I was... I didn't mean to be quibbling, but it's not the case that for the functions they are paid for the company but the union provides pay on top of that, so--
Unknown Speaker: What are those functions for which the union pays--
Mr. Silberman: --The contract says that they are not entitled to pay from the company for negotiations, for time spent in any meeting outside of the union office, and for any other activity unrelated to the duties of their office.
Unknown Speaker: --All right.
Mr. Silberman: If the--
Unknown Speaker: --when you talk about office, are they office... are they officers by reason of the union charter?
Mr. Silberman: --They are... I believe the answer to that question is no, Justice Kennedy.
It... the record is not entirely clear, but I believe the answer to that is no.
Unknown Speaker: Mr. Silberman, what about retirement pay?
When these senior officers retire as union officials, have they accumulated company retirement pay as well during the period that they're serving as union officials, so their retirement pay also comes from the company rather than from the union?
Mr. Silberman: If we are talking about the grievance chairman, these employees elected to this full-time position--
Unknown Speaker: Right.
Mr. Silberman: --For the 3 years that he serves in that office--
Unknown Speaker: Right.
Mr. Silberman: --he continues to accrue credit in the company's pension plan, so that yes, if he were to continue, he would be... he's earning pension credits for those years.
Unknown Speaker: What do you say... I take it the question is not... the word is payable, not compensation.
There is money... is the question is, is this money payable by reason of his service as an employee to the employer, all right.
Now, you've heard the petitioner say, just look at the record.
There are specific findings, which he began to list, which said that this money wasn't payable by reason of his former service, and so what is your response to that, that why is this money payable by reason of his service?
What, in other words, just as every... we were asking the petitioner, I would ask you, what clearly, or what line, or what conceptual line distinguishes those payments, in your view, that are by reason of his former service from those that are not, and what do you do about the district court, having found that these were not?
Mr. Silberman: First, Justice Breyer, I don't believe there are any district court findings that bear on the subject at all.
We have some legal conclusions, and this is essentially a legal question we're discussing.
And I... our answer is that we understand the phrase compensation for or by reason of service to cover any payment that is made to someone who is or has been an employee of the employer, and that is a payment that is provided in return for services that were provided to the employer.
Unknown Speaker: All right.
Now, here they say this is not in return for services that were provided to the employer.
This is in return for services that are being provided to the union, and what is your response to that?
Mr. Silberman: My response, Justice Breyer, is no, that is not the case, that these are... it is true that one of the conditions to receive these payments is that you must perform these services as a union representative, just as in an educational leave situation one of the conditions to receive that money is that you must be going to school full-time.
But that doesn't mean that it's not also by reason of the fact that you are an employee, for precisely, I believe, the reason you indicated in your earlier question, that this is only paid to employees and is paid as part of service to an employee, and I would say that if there are any questions about the language, and certainly one thing that I think has to be clear 60 years... 40... 50 years after the statute was enacted it can hardly be said that this language plainly and unmistakably condemns a practice that nobody has thought was illegal for 50 years.
If there's any doubt about what the language means--
Unknown Speaker: Well, nobody.
The court of appeals though it was illegal till they changed their mind, didn't they?
Mr. Silberman: --There was... there were... the Trailways court held that a particular kind of agreement, not necessarily this agreement, there are a number of courts the other way... certainly the parties to collective bargaining have been negotiating these things for 50 years without anybody thinking that there was a legal problem.
Unknown Speaker: But on the other side of that argument is a principle that exceptions to a statutory provision are to be construed narrowly.
Mr. Silberman: Justice Rehnquist, I'm not sure that that... whether that principle necessarily applies to a criminal statute.
I think it's particularly inapt here for two reasons.
The first is, as I was saying earlier, we have some exceptions to this statute that are crafted in a way to indicate that Congress was making the kinds of legislative and policy judgments that Congress makes in treating with this... with the subjects of welfare funds and the subject of dues check off in that way.
These are much more categorical exceptions which bespeak an effort to pull the entire area outside of the ambit of this criminal statute and leave it for treatment under other law.
The second critical point here is that we have very clear legislative history.
These provisions, these practices were called to Congress' intention.
Unknown Speaker: I'm really not impressed by that legislative history.
Here Congress is making substantial revisions in the labor laws, and I... and you say these practices were called to its attention.
Mr. Silberman: Well, Justice Rehnquist, let me try to impress you in the following two respects.
First, that we know that this... in 1947 those who were making these changes were not at all shy about saying this practice that's going on today in collective bargaining is illegal, it's illegitimate, we're trying to change it, and they made that very clear about a number of types of collective bargaining agreements.
They said nothing to suggest that this practice was something they were trying to reach.
Perhaps even more important, at the very same time that Congress did that, they enacted the changes to section 10(c) of the National Labor Relations Act to provide essentially a rule of equality whose purpose, the legislative history tells us, was precisely to allow company unions the same privilege that unions like the UAW already enjoyed under the law to negotiate for lost time arrangements of this sort.
Unknown Speaker: May I ask you just one factual question before your time runs out?
Most of what I notice in your brief and the Government brief seem clearly to refer to no-docking arrangements.
What is the most persuasive and clearest example you can point me to in that legislative materials where the full-time people were also being treated the same?
Mr. Silberman: The 194--
Unknown Speaker: Full-time for the union, I mean.
Mr. Silberman: --The 1941 Ford-UAW agreement which we quote in our brief expressly provides for full-time people.
It is the subject of a colloquy between Senator Ball and former... Gerald Reilly, who was a member of the National Labor Relations Board, in 1947.
The Chrysler agreement in practice provided for full-time union people.
It was the--
Unknown Speaker: So that colloquy is the strongest example for the--
Mr. Silberman: --It's the strongest example, Justice Stevens, of this being called to Congress' attention.
The absence of any congressional response and the 10(c) changes, it seems to me, altogether are what establish the legislative intent not to proscribe these kinds of practices.
Unknown Speaker: --Thank you, Mr. Silberman.
Ms. Brinkmann, we'll hear from you.
Argument of Beth S. Brinkmann
Mr. Brinkmann: Mr. Chief Justice, and may it please the Court:
I'd like to first address the relationship between section 302(c)(1) and section 8(a)(2).
The payments by reason of service as an employee that are excepted from the criminal provision of 302(a) are not limited to the section 8(a)(2) proviso of the National Labor Relations Act.
When the board has upheld no-docking practices, it's not because the board has held that it fits inside that proviso.
It's because the board has held that it doesn't violate the general prohibition or unfair labor practices of 8(a)(2).
Unknown Speaker: No, but they're current payments to current employees for services being performed currently, but the by-reason-of language would naturally be read to preserve the pension benefits of people who work for the union later and then get their pension benefits.
So you're right about the language with respect to the part-time people, but I'm not so sure you're right about it with regard to the full-time people.
Mr. Brinkmann: Well, Your Honor, we think that there is a three-step inquiry here that demonstrates that they are by reason of.
First of all, these are payments that were bargained for in a collective bargaining agreement that defines terms of payment.
Second of all, it is a but-for causation.
Unknown Speaker: What's the fact that it's in a collective bargaining agreement got to do with it?
Mr. Brinkmann: Because it talks about payments for services, Your Honor, and the quintessential location where one looks in a labor environment to find out what services and payment are due is in the collective bargaining agreement.
The second thing is that--
Unknown Speaker: You don't think the statute really meant that you can get around the prohibition--
--By putting in an agreement.
--against paying employees of the union by simply saying I'm really paying them as my employees--
Mr. Brinkmann: --No, we don't, Your Honor, and that is a necessary predicate.
It's certainly an indication that it's by reason of.
Unknown Speaker: --Well, it certainly has to be in the agreement.
Mr. Brinkmann: --Yes.
Unknown Speaker: But I don't know that the agreement solves anything.
Mr. Brinkmann: Another... well, there are two.
Another thing is that it's a but-for cause.
Union officers who may be involved in the grievance process who are not employees or former employees are not paid this.
The third step is the close nexus between the grievance chairman's prior service as an employee and the payments he's getting, in this case for adjusting grievances.
The grievance system that's structured in this industrial setting is a four-step process.
At each step the employee with the complaint is represented by another employee from that production unit, the steward at the first level, then a committeeman, and then the grievance chairman.
It is because of that service as an employee, as a production worker, that these people both in the nodocking situation and in this situation--
Unknown Speaker: This only applies to grievance chairmen?
It wouldn't apply to other union officials?
Mr. Brinkmann: --It would be a very different inquiry in different circumstances, Your Honor.
We think this is a clear case not only because of this close... because of this close nexus we do think that.
Unknown Speaker: Oh, but what about that, because that seems an awfully good question.
The... suppose this was the same circumstance, what the employer was paying for was an employee who became the chief negotiator for the union, okay, to write all the collective bargaining agreements.
Mr. Brinkmann: Mm-hmm.
Unknown Speaker: I mean, what about that?
Mr. Brinkmann: --We certainly think that closer inquiry would have to be looked at, Your Honor.
Unknown Speaker: But when you say close inquiry, I mean, that's... then you see, that's what I'm... doesn't that make you a bit nervous that the employer is paying for someone who's spending his full time, for example, being the union's chief negotiator in the collective bargaining contract?
Mr. Brinkmann: Well, Your Honor, there is the section 8(a)(2) proviso that prohibits domination interference.
This is a criminal prohibition, and when we look to enforce this--
Unknown Speaker: Suppose they happen to pay a million dollars for doing it?
Is it just... is that--
Mr. Brinkmann: --Those are several things... no.
Those are several things... we prosecute sham compensation, corrupt transaction--
Unknown Speaker: --Well, if, in fact, you were to prevail here, would that reasoning that allows you to prevail also permit the employer to pay for a full-time employee who is the negotiator for the union in respect to the collective bargaining agreement?
Mr. Brinkmann: --It's certainly one... we would be looking at that.
One thing that we would look at, for example, is industry acceptance of whether or not that is something that an employer bargains to pay for, which in the grievance context the answer is yes.
Unknown Speaker: In other words--
Mr. Brinkmann: I'm--
Unknown Speaker: --you're saying that the nature of the activity here is one you... it's the nature of the activity, the grievance, the nature of that activity, grievance, working out of grievances that makes the difference--
Mr. Brinkmann: --It certainly--
Unknown Speaker: --that makes this clear?
Mr. Brinkmann: --It certainly makes it clear in this case.
Unknown Speaker: And why does it make it clear?
Mr. Brinkmann: Because it's not a sham.
Because it's not some kind of corrupt transaction.
The questions that would raise suspicion, for example, is incommensurate pay, the kind of situation that occurred in the Phillips case in the Eleventh Circuit, retroactive negotiating, secret deals.
Those are the kinds of factors that--
Unknown Speaker: No, but--
Mr. Brinkmann: --look at as criminal--
Unknown Speaker: --for a whole different section of the shop, I mean, a section of the shop he never worked in, would that be a different situation?
Mr. Brinkmann: --I think that in this case it would not be so unrelated.
You'd have to again look at industry practice.
These are longstanding--
Unknown Speaker: I don't really see why negotiating the contract is unrelated, either.
As long as they... he's worked for the company for 3 or 4 days, then he becomes a full-time negotiator and he gets paid regular wages by the company and maybe they're supplemented a little by the union, and it's all out in the open.
It's... I agree with you, it's got to be all out in the open, but does that make it comply with the statute?
Mr. Brinkmann: --Well, the relationship to the services to the employee is not as clear, Your Honor.
The grievance adjustment process is part of the production--
Unknown Speaker: Oh, I understand your policy reasons for saying grievance... it's important that the grievers be paid, but in terms of the language of the statute, I don't see the distinction between the grievance person and the negotiator.
Mr. Brinkmann: --We think--
Unknown Speaker: In terms of the language of the statute.
Mr. Brinkmann: --When you're interpreting the words by reason of, Your Honor, we think that it is something more than a but-for clause.
Unknown Speaker: Well, it's much easier to negotiate with somebody who knows the business, familiar with the history, all of the informal rules that have developed over the years, than it is with a total stranger who just happens to be a lawyer or something like that.
Mr. Brinkmann: The fact is, Your Honor, experience shows that there's far less reason to believe that that is by reason of their service.
In this case, there's every reason to believe it.
Unknown Speaker: Is there anything in that that... just on that particular point that you're... in thinking about that, I'm thinking of grievances itself as being in a modern unionized context the very heart of the production process.
Mr. Brinkmann: Yes, Your Honor.
Unknown Speaker: Well, I... but I don't want to just... I knew you would agree with that, but I--
But I mean, I want to... I'd like you to say a little bit more.
As I think of the distinction, but is there anything in case law, or anything that I, you know, that would suggest that, or support it, or--
Mr. Brinkmann: Well, Your Honor, certainly not only is it because of production, I think it's also because it's just so part and parcel of the no-docking provision that the courts have all upheld--
Unknown Speaker: --We'd have to say that the grievance process is part of the production process in a way that the negotiating process is not part of the production process, or a line to be drawn in that way.
Is that a satisfactory thing from your point of view?
Mr. Brinkmann: --We certainly think that in a criminal prosecution one would still have to look at the industry accepted practices and all, but I think that certainly is an indication that it may not be by reason of.
To the contrary, another example--
Unknown Speaker: If we agreed with you, how would we come out in this case?
Did the contractual provision limit it just to--
Mr. Brinkmann: --Yes.
Unknown Speaker: --Just to grievance--
Mr. Brinkmann: No, to activities directly related to its office, and its office was defined in conjunction with the grievance system.
And this is a declaratory judgment action, Your Honor, to... so it's looking forward to declare whether or not these are per se invalid and petitioner's not entitled to that judgment.
Unknown Speaker: --The Government was taking the position below that further facts needed to be developed and then there was kind of a shift up here.
Can you explain, are there further facts?
Mr. Brinkmann: Your Honor, when we looked at the case on Caterpillar petitioner had not requested a remand at that point, and we don't... we believe that those would be additional factors that could be looked into to see if there was some kind of sham compensation or corrupt transaction.
We don't think that there is evidence in this record of that, but it could be appropriate to remand it, Your Honor, for the lower courts to--
Unknown Speaker: So if this chairman was spending part of his time negotiating the bargaining contract, would that come out from under what you think is permissible?
Mr. Brinkmann: --My understanding of the collective bargaining agreement is that was not to be paid for.
The terms of the collective bargaining agreement omitted paying for negotiation of vacation, things that were not directly related to its office, so the way in which this case comes to the court, I believe it's a declaratory judgment action, that payments under that collective bargaining agreement are per se a violation of 302(c).
Unknown Speaker: It seems to me that your reference to the collective bargaining agreement and the inclusion of the compensation in part of those negotiations cuts against you as much as for you.
I should have thought that the very purpose of this statute was to eliminate this from the collective bargaining context so that the union could not make demands that its officials be compensated.
Mr. Brinkmann: Your Honor--
Unknown Speaker: It seems to me that works very much against you.
The whole purpose of this is to take this out of the collective bargaining context.
Mr. Brinkmann: --Your Honor, we don't believe so.
Again, there is this... 302(c) was enacted against this whole backdrop of the National Labor Relations Act which had already been enacted and was amended at the same time, and now provides for unfair labor practices civil penalties, not criminal sanctions.
302(a) is a broad criminal prohibition against employers paying union officials.
302(c)(1) is the first exception, carving out an exception recognizing that employers and employees have a different relationship.
Unknown Speaker: Thank you, Ms. Brinkmann.
Mr. Gangemi, you have a minute remaining.
Rebuttal of Columbus R. Gangemi
Mr. Gangemi: The bottom line, both respondent and the United States conflate the concept of service with the concept of the status of a prior employee.
The statute allows the employer to pay for the services of an individual as an employee.
It does not allow the company and the union to agree to pay someone to be a union official because of their former status as an employee of the employer.
The statute sets up a clear dichotomy.
You can pay a union official to be an employee, but you cannot pay an employee to be a union official, and it makes a mockery of that dichotomy for the company and the union to... or for the union to argue here that you can override that dichotomy by declaring one to be the other, by declaring service as an employ... service as a union official to be and payment for it to be a benefit for having been an employee of the employer in the past.
It collapses, or conflates those two very distinct concepts which the statute recognized, that you could have a dual capacity employee.
Chief Justice Rehnquist: Thank you, Mr. Gangemi.
The case is submitted.