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Sun Oil Co. v. National Labor Relations Board

argued: February 17, 1978.



Seitz, Chief Judge, Rosenn and Garth, Circuit Judges.

Author: Rosenn

ROSENN, Circuit Judge.

This appeal raises the question, which we believed we had already laid to rest in American Bridge Division, U.S. Steel Corp. v. NLRB, 457 F.2d 660 (3d Cir. 1972), and later in NLRB v. Gloekler North East Co., 540 F.2d 197 (3d Cir. 1976), of whether a local independent union's affiliation with a large international union creates an entirely distinct bargaining representative. In the instant case, the Sun Oil Company of Pennsylvania ("the Company") petitions for review of two decisions and orders of the National Labor Relations Board ("NLRB" or "the Board") sustaining a finding that the Company committed unfair labor practices in violation of section 8(a)(5) of the National Labor Relations Act ("NLRA"). The Board charged that the Company's refusal to honor a union security provision of a collective bargaining agreement with two independent union locals ("Independents"), which became affiliated with the Oil, Chemical, and Atomic Workers International Union ("International" or "OCAW") during the term of their bargaining agreement, and its refusal to bargain with them until certified after a Board supervised election constituted a refusal to bargain in violation of section 8(a)(5).

We deny enforcement of the Board's order.


The Company operates, among other facilities, two petroleum storage and distribution terminals, one in Clermont, Indiana, and one in Owosso, Michigan, both of which employ approximately thirty people. Since 1969 in Owosso, and since 1970 in Clermont, the Company's employees were represented exclusively by two independent unions, the Central Michigan Independent Oil Workers Union(Owosso) and the Independent Drivers and Warehousemen's Association of Indianapolis (Clermont), respectively. Both of these independents had entered into collective bargaining agreements with the Company in 1974, the Clermont contract extending until 1976, the Owosso contract extending until 1977. Both contracts contained union-security provisions, which required that the Company discharge employees who did not join the independent union.

During the term of the contracts, representatives of the International met with officers of both Independents to discuss the advantages of affiliating with the International. After several months of consideration, the members of both Independents ultimately voted to join the International, the Clermont independent in June 1975, the Owosso independent in September 1975. Thereupon, the International chartered each of the former Independents as separate locals. Subsequently, the president of each local sent a letter to the Company, informing it of the Independents' "change in name" and the local's intent to honor fully all contractual commitments to the Company.

The Company responded identically to these letters. The Company informed the locals that it would not recognize or bargain with the OCAW Local because the Company had a good faith doubt as to the actual representational preferences of a majority of its employees and because it considered the OCAW Local an entirely new, and uncertified, bargaining representative. Therefore, in light of its responsibilities to respect the will of its employees, the Company stated that it would file a representation ("RM") petition with the Board, requesting the Board to conduct a secret ballot election to determine the employees' choice for collective bargaining representative.*fn1

The NLRB Regional Director ordered elections in both plants, and in both plants the employees voted to affiliate with the International. Accordingly, the Board certified a local of the OCAW as collective bargaining representative for employees of the Owosso plant in September 1975, and in November 1975, certified an OCAW Local for the Clermont plant. In both locals, the union representatives indicated that they intended to abide by the agreement each had signed as an independent a year earlier.

The Company met its obligation to recognize the newly certified Locals and to honor the collective bargaining agreements in all aspects, except one.*fn2 The sole problem concerned the union-security clause of the contract: the Company refused to agree to an amended union-security clause, proposed by the OCAW Locals, requiring employees to become members of the OCAW Local as a condition of employment in both the Clermont and Owosso plants. The Company did indicate, however, that it would be willing to bargain about any other proposals the OCAW Local might have.

In response to the Company's refusal to enforce the union-security clause, the locals filed identical charges with the NLRB, in Detroit and Indianapolis, alleging that the Company unlawfully refused to bargain and that it unlawfully refused to continue in effect all provisions of the collective bargaining agreements with the former Independents. Following an investigation by the appropriate regional offices, the NLRB issued complaints based on the filed charges. The matter was heard before an administrative law judge ("ALJ") on July 1 and 2, 1976, in Indianapolis, and on July 7, 1976, in Detroit. On the basis of those hearings, and submitted memoranda of law, the ALJ rendered a decision and order in each case, finding that the affiliation of the Independents with the International was valid as of the date of the affiliation vote, and, as successors to the Independents, the newly affiliated Locals were entitled to be recognized by and to bargain with the Company. Furthermore, the ALJ concluded that the Company's refusal to continue in full force and effect all provisions of each collective bargaining agreement with the Independents, including the union-security clause, also constituted a violation of section 8(a)(5) of the NLRA.

The Company timely filed exceptions to both of these decisions on the grounds that the OCAW Local constituted a new and different collective bargaining representative, and that the NLRB's election and certification of the OCAW Local terminated the Company's obligation to enforce the prior union-security provision. Therefore, there was no obligation to agree to a new union-security provision with the OCAW Local.

On March 25, 1977, a three-member panel of the Board affirmed and adopted the decisions and orders of the ALJ, directing the Company to bargain with the OCAW Locals and to honor in full all terms of the collective bargaining agreements, including the union-security provision. On March 30, 1977, the Company filed a petition for review; on May 6, 1977, the NLRB cross-applied for enforcement. On June 8, 1977, this ...

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