482 U. S. 27
June 1, 1987
A dyeing company called Sterlingwale went out of business. A few months later, Fall River Dyeing & Finishing came along, bought most of the old buildings and machinery, and hired back a good many of the former Sterlingwale employees, who all belonged to a union. But this new company refused to negotiate with these former employees about getting a collective bargaining agreement. Under labor law, a ‘successor’ corporation had to at least negotiate with the former corporation’s union if a majority of the employees were the same. Fall River argued that by the time the plant was fully up and running again the old Sterlingwale employees had become the minority.
The Court ruled 6-3 that Fall River had still been unfair to the union in refusing to negotiate. Blackmun wrote for the Court, and found that the facilities, processes, and overlap in employees were substantial enough to call Fall River the successor of Sterlingwale. Even though eventually the old employees constituted a minority, when Fall River was first able to start some operations, they were a majority, and thus entitled to collective bargaining negotiation. In saying that such a “substantial and representative complement” triggered the duty to negotiate, Blackmun deferred to the views of the NLRB. He closed by saying that a union need only demand negotiation once – and it will be required once the “complement” of employees is present.
Powell, joined by Rehnquist and O’Connor, dissented. He did not think Fall River was a clear successor to Sterlingwale – their was a gap of several months between the two companies, the scale of operations was very different, and Fall River ultimately had a majority of new employees. Even if Fall River was a successor, Powell disagreed with the “substantial and representative complement” test, because it could easily result in a collective bargaining agreement being negotiated before a majority of the employees bound by it were even hired, which would be unfair to them.
I’m not sure who’s right legally, though I strongly lean toward Powell. Regardless, the legal rule announced in the case is atrocious as a matter of policy. It’s remarkable how solicitous American law is of patently unbiblical organizations in open rebellion against authority. The majority opinion repeatedly makes reference to the goal of “industrial peace” – a rather Orwellian turn of phrase, since true peace can never come from anything except Christlike submission (Cf. 1 Peter 2:13ff.).