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In re New Jersey Bell Telephone Co.

Decided: October 2, 1950.

IN THE MATTER OF THE ARBITRATION BETWEEN NEW JERSEY BELL TELEPHONE COMPANY, A CORPORATION OF NEW JERSEY, APPELLANT ON APPEAL,
v.
COMMUNICATIONS WORKERS OF AMERICA, NEW JERSEY TRAFFIC DIVISION NO. 55, CIO, RESPONDENT ON APPEAL, AND BOARD OF ARBITRATION, ET AL., ADDITIONAL RESPONDENTS ON APPEAL, AND STATE OF NEW JERSEY, ADDED PARTY AND RESPONDENT ON APPEAL



On appeal from Superior Court, Appellate Division, whose opinions are reported in 9 N.J. Super. 110 and 124.

For reversal -- Chief Justice Vanderbilt, and Justices Case, Heher, Oliphant, Burling and Ackerson. For affirmance -- Justice Wachenfeld. The opinion of the court was delivered by Burling, J. Heher, J., concurring in result.

Burling

[5 NJ Page 362] Two appeals are involved, both of which have been taken by the New Jersey Bell Telephone Company (hereinafter referred to as "Company") from two judgments of the Superior Court, Appellate Division. The first of said judgments, entered August 8, 1950, modified and affirmed, as modified, an order of a Statutory Board of Arbitration (hereinafter referred to as "Board"), which order was made pursuant to the provisions of L. 1946, c. 38, as amended and supplemented by L. 1947, c. 47 and c. 75, L. 1949, c. 308 and L. 1950, c. 14 (N.J.S.A. 34:13B-1 et seq.), and awarded, inter alia, a wage increase, union security, in the form of maintenance of membership, check-off and a modified union shop, and a partial reclassification of various cities included in wage zones in which wage schedule differentials

existed. The second of said judgments, entered August 14, 1950, denied a motion made by the Company for leave to take additional testimony in connection with the Board's order and various alleged irregularities therein with reference to the Findings of Fact, Decision and Order. The two appeals were consolidated for argument and hearing on appeal and will be disposed of together.

The pertinent facts giving rise to the present appeals are as follows:

The Company is a public utility corporation incorporated under the laws of the State of New Jersey; the Communications Workers of America, New Jersey Traffic Division No. 55, CIO (hereinafter referred to as "Union") is the collective bargaining agent of all the non-supervisory employees in the Company's Traffic Department, having been certified as such by the National Labor Relations Board; there are approximately 10,000 such employees in the Traffic Department who, for the most part, are telephone operators; on May 10, 1949, the collective bargaining contract, being the last of a series of annual contracts, between the Company and the Union expired; a dispute arose between the parties involving the terms and conditions to be included in a new contract; pursuant to the provisions of sections 8 to 12 of L. 1946, c. 38, then in effect but since repealed by L. 1950, c. 14, a fact-finding panel was established to hear the issues in dispute and to make recommendations for resolving the same; the panel made its recommendations on February 20, 1950, but the Company and the Union rejected the recommendations; no agreement was reached by the parties; the Governor, on March 1, 1950, pursuant to the statute, seized the plant, equipment and facilities of the Company and on March 3, 1950, appointed three persons and confirmed the designation of one person each by the Company and the Union to serve as members of the Board, to hear and determine the dispute, pursuant to the provisions of the statute; the Board conducted hearings with respect to the matters in dispute and concluded the hearings on March 28, 1950; the Order of the Board was

dated April 19, 1950, and was filed with the Governor on April 20, 1950; the Order was signed by the five members of the Board but contained endorsements to the effect that as to certain specified items of the Order the Union member dissented and as to certain specified items of the Order the Company member dissented; the "Findings of Fact and Decision" of the Board was not filed until May 25, 1950, or five weeks after the Order had been filed; it was signed by the three public members and the Union member, but the signature of the Union member was accompanied with the following notation: "Except as indicated in accompanying Dissenting Opinion"; on the same day, May 25, 1950, the Company member filed a "Dissent and Findings" and the Union member filed a "Dissenting Opinion"; the order disposed of numerous items in dispute and, inter alia, awarded a wage increase, union security, in the form of maintenance of membership, check-off and a modified union shop, and a partial reclassification of various cities included in wage zones in which wage schedule differentials existed; the Company appealed from the above specified awards of the Order and also moved for leave to take testimony to establish that certain alleged irregularities had been committed by the Board with respect to the Findings of Fact and Decision and Order; no appeal was filed by the Union; the Appellate Division, by its judgment of August 8, 1950, modified the Order so as to make the provision thereof granting a wage increase effective as of April 20, 1950, instead of April 16, 1950, as contained in the Order, and, as modified, affirmed the Order; the Appellate Division by its judgment of August 14, 1950, denied the Company's motion; the Company filed appeals from both judgments; the Attorney General of the State of New Jersey made a motion that the State of New Jersey be admitted as a party to the appeal and the motion was granted by this Court.

The questions involved will be dealt with in the following manner:

I.

CONSTITUTIONALITY OF STATUTE

The Company challenges the constitutionality of the state statute dealing with labor disputes in public utilities. L. 1946, c. 38, as amended and supplemented by L. 1947, c. 47 and c. 75, L. 1949, c. 308, and L. 1950, c. 14 (N.J.S.A. 34:13B-1 et seq.). The Union, in limine, argues that the Company is estopped from questioning the constitutionality of the statute by reason of its participation in the procedure provided by the statute. The Union states that this question was raised and argued before the Appellate Division but was not decided. The Union's argument is based upon the principle stated in United Fuel Gas Co. v. Railroad Commission, 278 U.S. 300, 73 L. Ed. 390 (1929), "That one who has invoked action by state courts or authorities under state statutes may not later, when dissatisfied with the result, assail their action on the theory that the statutes under which the action was taken offend against the Constitution of the United States." It is sufficient to say that the principle is inapplicable to the present case because the proceedings under the statute were not initiated by the Company but were invoked by the Governor. The Company was required by the mandate of the statute to participate in the prescribed proceedings.

A.

INVASION OF A PRE-EMPTED FIELD.

The Company's first contention is that the statute is unconstitutional because it invades a field pre-empted by the Federal Government through the enactment of the National Labor Relations Act, 29 U.S.C.A., § 151 et seq., and the Labor-Management Relations Act, 1947, 29 U.S.C.A., § 141 et seq. This question was fully explored and disposed of by this court in Van Riper v. Traffic Telephone Workers Federation

of N.J., 2 N.J. 335 (1949), wherein we decided that our state statute was not in conflict with federal legislation. The Company argues, however, that since our decision on this point in the Van Riper case, supra, the United States Supreme Court, in International Union of U.A.A. & A. v. O'Brien, 339 U.S. 454, 94 L. Ed. (Adv. Op.) 659 (May 8, 1950), has decided that the right to strike peacefully for higher wages is established by the federal legislation, that the latter does not permit concurrent state regulation in this area, that since Congress has occupied this field it is closed to state regulation, and, ergo, that our state statute is unconstitutional.

Our analysis of the O'Brien case, supra, does not lead us to the same conclusion. In that case the constitutionality of the strike vote provision of the Michigan labor mediation law was questioned. The union had struck against a private industrial organization, engaged in interstate commerce, without conforming to the prescribed state procedure; the state procedure differed from that provided in the federal legislation and the court decided that because of the conflict the state statute was unconstitutional. The court said that the regulation of the right to peacefully strike for higher wages had been pre-empted by Congress, but the case being decided by the court involved a statute regulating the right to strike against private industry. It was not a statute such as the New Jersey statute, in which a state, in the exercise of its sovereignty, seeks to maintain without interruption the supply of services, considered essential to the welfare and health of its people, being furnished by a public utility, operating under a franchise by the state, whose services furnished are primarily intrastate. It is significant that in the O'Brien case, supra, the court said, "Even if some state legislation in this area could be sustained, the particular statute before us could not stand. For it conflicts with the Federal Act." Our examination of the federal act discloses no provision therein which prohibits a state, in the exercise of its police power, from protecting itself against strikes or lockouts in public utilities which would imperil the health and safety

of its citizens. It is noted that the Labor-Management Relations Act, 1947, in sections 206-210, authorizes the Federal Government to proceed, pursuant thereto, to enjoin threatened strikes or lockouts which, if permitted to occur, might imperil the national health or safety. We find no authority in the federal act for the Federal Government to so act to prevent similar emergencies which may be state-wide only and which may be of insufficient magnitude to imperil the national health and safety. Since we find no provision in the federal act prohibiting a state from enjoining threatened strikes or lockouts in public utilities which, if permitted to occur, might imperil the health, welfare and safety of its people in an emergency of state-wide proportions only, since the federal act does not authorize the Federal Government to act in such cases, and since the "intention of Congress to exclude states from exerting their police power must be clearly manifested," Allen-Bradley Local v. Wisconsin Employment Relations Board, 315 U.S. 740, 86 L. Ed. 1154 (1942), we conclude that the right of the states to prohibit strikes or lockouts in this sphere has not been pre-empted by Congress, and that the O'Brien case, supra, is inapplicable to the present situation.

We reiterate the statement made in the Van Riper case, supra, that "Thus the power still resides in the states in a proper case to prohibit strikes notwithstanding the existing federal legislation." We consider this a "proper case" within the foregoing statement and find nothing in the O'Brien case, supra, of a dissuasive nature.

B.

UNION SECURITY.

The Company next contends that the Order of the Board awarding a modified union shop is in conflict with the Federal Labor-Management Relations Act, 1947. We are in accord with this contention. The Company is engaged in interstate commerce, albeit the services rendered by it are predominantly

intrastate, and accordingly, the Federal Act is applicable to it. The Federal Act is predicated upon the philosophy of collective bargaining which is the antithesis of compulsion. Section 8(a)(3) of the Federal Act provides that under certain conditions therein delineated, the employer shall not be precluded "from making an agreement with a labor organization," where the qualified number of employees have voted to authorize such labor organization "to make such an agreement" for a union shop.

Clearly the expressed attitude of Congress is that a union shop to be lawful must result from an agreement. It necessarily follows that the creation of a union shop by compulsion is repugnant to the letter and the spirit of the Federal Act. Even under the National Labor Relations Act, popularly known as the Wagner Act, an employer could not be required to enter into a union security agreement. In labor disputes which arose during the war, in which the union security question was raised, the matter was usually disposed of by the National War Labor Board's issuing a directive order for maintenance of membership and check-off. It is observed that directive orders of the National War Labor Board were merely advisory and not mandatory. See Employers Group, etc., v. National War Labor Board, 143 F.2d 145, 148 (C. of A.D.C. 1944); National Labor Relations Board v. Andrew Jergens Co., 175 F.2d 130, 134 (C. of A., Ninth Circuit, 1949). It is also noted that under section 302 of the Federal Labor-Management Relations Act, 1947, it is made illegal for an employer to check-off union dues or for a labor union to accept the same except pursuant to written assignment from the employee. The award of the Board in the present case requires, in addition to maintenance of membership and ...


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