Graphic Communications International Union, Local 508 O-K-I v. National Labor Relations Board

977 F.2d 1168
CourtCourt of Appeals for the Seventh Circuit
DecidedOctober 21, 1992
DocketNo. 91-3901
StatusPublished
Cited by1 cases

This text of 977 F.2d 1168 (Graphic Communications International Union, Local 508 O-K-I v. National Labor Relations Board) is published on Counsel Stack Legal Research, covering Court of Appeals for the Seventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Graphic Communications International Union, Local 508 O-K-I v. National Labor Relations Board, 977 F.2d 1168 (7th Cir. 1992).

Opinion

POSNER, Circuit Judge.

This petition by a union to review an order of the National Labor Relations Board requires us once again to consider the duty of an employer to open its books to the union upon demand. In June of 1983 the union and the employer (Nielsen Lithographing Company) began negotiations for a new collective bargaining agreement to replace the existing agreement, which was about to expire. The company demanded 76 concessions designed to reduce its labor costs. It did not base the demand on any claim that it was in financial jeopardy, strapped for cash, broke or about to go broke, unprofitable, or otherwise unable to pay the existing level of wages and fringe benefits. It claimed merely that it needed the concessions “to compete”: “the costs in our contract [the existing collective bar[1169]*1169gaining agreement] were prohibitive”; “the competitive edge ... was changing, and ... there was a problem with competition now that they hadn’t had in the past.” Nielsen had once had better equipment than its competitors, enabling it to compete effectively even though its labor costs were higher. No longer. The competitors were getting better equipment. “[T]he company was making a profit ... [but] couldn’t compete. The trends showed them that they would have a worse problem in the future.” “Try as we may, we simply can not compete with them.” “To protect the jobs of our employees we must protect our ability to compete.” “To survive we must be able to compete.” “It is your job that is on the line.... [W]e have to be able to compete people-wise also. If we don’t the recent trend of losing even greater amounts of work to other companies will continue and the jobs our employees now have will also be lost.” And so on in this vein. Nielsen backed up these claims with statistics showing that its output had dropped in recent years, that the number of employees in the bargaining unit had dropped by 20 percent since 1980 through layoff and attrition, that its geographically proximate competitors had acquired the equipment (the “half-web” press) that had given Nielsen its competitive advantage, and that these competitors paid their employees lower wages and fringe benefits for longer hours.

The union responded to this demand, made in the second bargaining session for the new contract, with a demand for detailed financial information, including the company’s financial statements and tax returns for the past three years, the projected balance sheets and income statements that the company had submitted to banks to obtain loans, and information concerning the salaries and perquisites of the company’s managerial employees. The company refused to supply the requested information, declared (after six months of bargaining and 22 bargaining sessions) an impasse, and unilaterally imposed the concessions that it had demanded from the union. This precipitated a strike. A few months into the strike the union made an unconditional offer for the striking workers to return to work. But by that time the company had hired permanent replacements for all the striking workers. The union filed charges with the Board, claiming that it had been striking in protest against the company’s unfair labor practice in refusing to turn over the requested information. If so, the workers who had struck were entitled to get their jobs back; if not, not. NLRB v. Mackay Radio & Telegraph Corp., 304 U.S. 333, 345-46, 58 S.Ct. 904, 910-11, 82 L.Ed. 1381 (1938); NLRB v. Jarm Enterprises, Inc., 785 F.2d 195, 202 (7th Cir.1986).

Originally the Board sided with the union. We reversed (854 F.2d 1063 (7th Cir. 1988)) because the Board had ignored our decision in NLRB v. Harvstone Mfg. Corp., 785 F.2d 570, 575-77 (7th Cir.1986), which had held that if the employer does not base its demand for concessions on a claimed inability to pay — in which event NLRB v. Truitt Mfg. Co., 351 U.S. 149, 76 S.Ct. 753, 100 L.Ed. 1027 (1956), would entitle the union to demand substantiation by the employer’s financial records — the union has no right to demand such records. See also General Electric Co. v. NLRB, 916 F.2d 1163, 1172 (7th Cir.1990); Washington Materials, Inc. v. NLRB, 803 F.2d 1333, 1338-39 (4th Cir.1986). On remand, the Board, rather than simply reinstating its original decision with a disapproving glance at our decision in Harvstone or an effort at distinguishing it, reexamined its position from the ground up; concluded that our decision was correct and should be adopted as the Board’s position; and dismissed the unfair labor practice charges. The union argues that we should either overrule or distinguish Harvstone.

A request (invariably by the union) for information in a negotiation for a collective bargaining agreement is. like a discovery demand in a lawsuit. NLRB v. Acme Industrial Co., 385 U.S. 432, 437, 87 S.Ct. 565, 568, 17 L.Ed.2d 495 (1967); Chicago Tribune Co. v. NLRB, 965 F.2d 244, 246-47 (7th Cir.1992); NLRB v. Illinois-American Water Co., 933 F.2d 1368, 1378 (7th Cir.1991). It can be motivated by a genuine desire for relevant information, or it [1170]*1170can be designed to harass. In the first case, although the desire is by hypothesis genuine, the union may be mistaken in thinking the information demanded relevant. If it is relevant, the union—provided it doesn’t already have the information, a significant qualification in this case, as we shall see—is entitled to it as a corollary of the statutorily protected right of collective bargaining. Id. at 1377; NLRB v. Burkart Foam, Inc., 848 F.2d 825, 833 (7th Cir.1988).

The second case—that of a request designed to harass—has a tripartite structure. The union may want the information because it is embarrassing to the company, in which event either the company may make bargaining concessions to avoid having to reveal it or the workers’ support for the union may increase because the revelations make the workers angry at the company. The union may want the information in the hope that the company will refuse its demand, thereby handing the union a legal issue that may enable it to convert an economic strike into an unfair labor practice strike and thus get its members reinstated when the strike is over. Or the union may want the information simply in order to delay the evil day on which the company cuts the workers’ wages and fringe benefits; and the threat of delay may cause the company to moderate its demands.

The third point will bear some elaboration.

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977 F.2d 1168, Counsel Stack Legal Research, https://law.counselstack.com/opinion/graphic-communications-international-union-local-508-o-k-i-v-national-ca7-1992.