Brown v. Hotel & Restaurant Employees & Bartenders International Union Local 54

468 U.S. 491, 104 S. Ct. 3179, 82 L. Ed. 2d 373, 1984 U.S. LEXIS 142, 5 Employee Benefits Cas. (BNA) 1585, 52 U.S.L.W. 5042, 116 L.R.R.M. (BNA) 2921
Supreme Court of the United States·Decided July 2, 1984·No. 83-498·Published·Cited by 268 cases

Opinions

Justice O’Connor

delivered the opinion of the Court.

In 1976, the citizens of New Jersey amended their State Constitution to permit the legislative authorization of casino [494]*494gambling within the municipality of Atlantic City.1 Determined to prevent the infiltration of organized crime into its nascent casino industry and to assure public trust in the industry’s integrity, the New Jersey Legislature enacted the Casino Control Act (Act), N. J. Stat. Ann. § 5:12-1 et seq. (West Supp. 1983-1984), which provides for the comprehensive regulation of casino gambling, including the regulation of unions representing industry employees. Sections 86 and 93 of the Act specifically impose certain qualification criteria on officials of labor organizations representing casino industry employees. Those labor organizations with officials found not to meet these standards may be prohibited from receiving dues from casino industry employees and prohibited from administering pension and welfare funds. The principal question presented by these cases is whether the National Labor Relations Act (NLRA), as amended, 29 U. S. C. § 141 et seq., precludes New Jersey from imposing these criteria on those whom casino industry employees may select as officials of their bargaining representatives. We hold that it does not.

I

A

The advent of casino gambling in New Jersey was heralded with great expectations for the economic revitalization of the [495]*495Atlantic City region, but with equally great fears for the potential for infiltration by organized crime. The state legislature conducted extensive hearings and, in cooperation with the Governor, commissioned numerous studies on how best to prevent infiltration by organized crime into the casino industry.2 These studies confirmed the fact that the vast amount of money that flows daily through a casino operation and the large number of unrecorded transactions make the industry a particularly attractive and vulnerable target for organized crime. The New Jersey Commission of Investigation (NJCI), for example, found that there was a “well-organized highly functional organized crime network in [New Jersey]” which had become more interested in investing funds in legitimate enterprises.3 The NJCI feared that such an incursion by organized crime into the Atlantic City casinos might also be accompanied by extortion, loansharking, commercial bribery, and tax and antitrust violations. It was on the basis of these hearings and empirical studies that New Jersey finally adopted the Act, a comprehensive statutory scheme that authorizes casino gambling and establishes a rigorous system of regulation for the entire casino industry.

In order to promote “public confidence and trust in the credibility and integrity of the regulatory process and of [496]*496casino operations,” the Act “extend[s] strict State regulation to all persons, locations, practices and associations related to the operation of licensed casino enterprises and all related service industries.” N. J. Stat. Ann. § 5:12 — 1(b)(6) (West Supp. 1983-1984). The Casino Control Commission (Commission), an independent administrative body, possesses broad regulatory authority over the casinos and other related industries, §§5:12-63 to 5:12-75. The Division of Gaming Enforcement (Division), a part of the Attorney General’s Office, is charged with the responsibility for investigating license and permit applicants and for prosecuting violators of the Act, §§5:12-76 to 5:12-79.

The Act imposes strict licensing requirements on any business seeking to own and operate a casino hotel, §§5:12-84(a)-(c); on suppliers of goods and services to casino hotels, §§5:12-12, 5:12-92; on all supervisory employees involved in casino operations, §§5:12-9, 5:12-89; and on all employees with access to the casino floor, §§5:12-7, 5:12-90. The Act requires registration, rather than licensing, for employees of casino hotels. Casino hotel employees include those performing “service or custodial duties not directly related to operations of the casino, including, without limitation, bartenders, waiters, waitresses, maintenance personnel, kitchen staff, but whose employment duties do not require or authorize access to the casino.” §5:12-8. Most relevant to this litigation, § 93(a) of the Act also requires labor organizations that represent or seek to represent persons employed in casinos or casino hotels to register annually with the Commission, §5:12-93(a).

All those entities and persons required to be licensed or registered are subject to the disqualification criteria set forth in § 86 of the Act. Section 86 specifically lists criteria for the disqualification of casino licensees. The Commission is authorized to revoke, suspend, limit, or otherwise restrict the registration of any casino hotel employees who would be disqualified for a casino license. N. J. Stat. Ann. §§ 5:12-86, 5:12-91(b) (West Supp. 1983-1984). All industries offering [497]*497goods or services to the casinos are also subject to the disqualification criteria of § 86. § 5:12-92.

Section 93(b) directly subjects registered labor organizations to the §86 disqualification criteria and imposes two express penalties for noncompliance:

“No labor organization, union or affiliate registered or required to be registered pursuant to this section and representing or seeking to represent employees licensed or registered under this act may receive any dues from any employee licensed or registered under this act and employed by a casino licensee or its agent, or administer any pension or welfare funds, if any officer, agent, or principal employee of the labor organization, union or affiliate is disqualified in accordance with the criteria contained in section 86 of this act. The commission may for the purposes of this subsection waive any disqualification criterion consistent with the public policy of this act and upon a finding that the interests of justice so require.”

The disqualification criteria referred to in §86 include convictions for a list of enumerated offenses or “any other offense which indicates that licensure of the applicant would be inimical to the policy of this act and to casino operations.” N. J. Stat. Ann. § 5:12 — 86(c)(4) (West Supp. 1983-1984). Disqualification may also result if an individual is identified “as a career offender or a member of a career offender cartel or an associate of a career offender or career offender cartel in such a manner which creates a reasonable belief that the association is of such a nature as to be inimical to the policy of this act and to gaming operations.” § 5:12-86(f ).4

[498]*498B

Appellee Hotel and Restaurant Employees and Bartenders International Union Local 54 (Local 54) is an unincorporated labor organization within the meaning of § 2(5) of the NLRA, 29 U. S. C. § 152(5). Local 54 represents in collective bargaining approximately 12,000 employees, 8,000 of whom are employed in casino hotels in Atlantic City.

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Brown v. Hotel & Restaurant Employees & Bartenders International Union Local 54, 468 U.S. 491, 104 S. Ct. 3179, 82 L. Ed. 2d 373, 1984 U.S. LEXIS 142, 5 Employee Benefits Cas. (BNA) 1585, 52 U.S.L.W. 5042, 116 L.R.R.M. (BNA) 2921 (1984).

468 U.S. 491 (Brown v. Hotel & Restaurant Employees & Bartenders International Union Local 54) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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