Amalgamated Lithographers of America

AMALGAMATED LITHOGRAPHERS. OF AMERICA (IND.) 985 Amalgamated Lithographers of America (Ind.) and Local No. 17 of the Amalgamated Lithographers of America (Ind.) and The Employing Lithographers,-a Division of the Graphic Arts Employers Association, and Lithographers & Printers National 'Association, Inc. Amalgamated Lithographers of America (Ind.) and Local No. 17 of the Amalgamated Lithographers of America (Ind.) and The Employing Lithographers, a Division of the Graphic Arts Employers Association, and Lithographers & Printers National Association, Inc. Amalgamated Lithographers of America ; Local No. 17 and The Employing Lithographers, a Division of the Graphic' Arts Employers Association. Cases Nos.. ?O-CC-203, 20-CE-1, and 20-CB-728. March 1, 1961 DECISION AND ORDER On July 25, 1960, Trial Examiner David F. Doyle issued his Inter- mediate Report in the above-entitled proceedings, finding that the Respondents had' engaged in and were engaging in certain unfair labor practices: and recommending that they cease and desist there- from..and take certain affirmative action, as set forth in the copy of the Intermediate Report attached hereto. Thereafter the Respondents filed exceptions to the Intermediate Report and a brief in support of their exceptions; the Charging Party filed a brief in support of the Intermediate Report., On November 21, 1960, the Board heard oral argument in- Washington, D.C., in which all parties appeared and participated. , . , - • The Board has reviewed the rulings of the Trial Examiner made at the hearing and finds-that no prejudicial error'was committed. The rulings. are hereby affirmed. ' The Board, has considered the Inter- mediate Report, the exceptions, the briefs, the oral argument, and the entire record in. the case, and hereby adopts the findings, conclu- sions, and recommendations of the Trial Examiner, with the following amplification. 1. - The Taft-Hartley Act made it an unfair labor practice for a labor organization to induce or encourage employees to engage in a strike -where. one of, its objects was to cause any employer to cease doing business with any other person 2 However, that Act was silent as to whether a so-called hot cargo' clause-that is, an agreement between a labor union and an employer whereby the latter agreed not to handle or work on any product received from an employer who, was engaged i Union Employers Section, Printing Industry of America, Inc., appeared and was per- mitted to participate in the oral argument as amicus curiae. ' 2 Section 8(b) (4) (A). 130 NLRB No. 102. ' 986 !DECISIONS-'F -NATIONAL. LABOR RELATIONS -BOARD in . a labor . dispute=was - unlaw-fu13 In the Sand Door 'ease 74 -.the Supreme Court said. that such an agreement was lawful; although it was not a defense to conduct which fell within. the prohibition' of Section 8(b) (4) (A)..This-.holding that.a "hot cargo" agreement was lawful was considered by proponents of the 1959 amendments to the Taft-Hartley Act as . a "loophole" which had to be closed.' , Accord- ingly, Section 8 (e) of the Landrum-Griffin Act makes unlawful `any contract or agreement, express or implied" whereby an employer agrees not to handle the products of another employer or agrees to cease doing business with any other person. And amended Section 8(b) (4) (A) makes a-strike to. achieve such an agreement equally unlawful. The 1957. collective-bargaining contract between Respondent Local 17 and the Association, effective to October 18, 1959, containeda sec- tion (21) whereby the contracting parties agreed that employees would not be required to execute any lithographic production work received from, or destined for, any employer with whom the Union was engaged ina strike or lockout. It was also agreed that employees would not be required to use any lithographic production work made in any shop not.under contract with the Respondent International, -with certain exceptions not here relevant. Further,- the section pro- vided that in the event the employer- should execute such "struck work" or use any such nonunion work in its plant, the Union was to have the right to terminate the agreement "forthwith." Respondents concede that this section is now unlawful by virtue of Section 8(e) of the Landrum-Griffin Act. They contend, however, that certain clauses proposed in the 1959 negotiations for a new con- tract and intended to replace the unlawful "struck work" and "trade shop" clauses of the recently expired contract are lawful. These clauses are set out at length in the Intermediate Report. Briefly they provide that the employer will not render assistance to any other lithographic employer any of whose plants is struck by a local of Respondent International and accordingly will not request any em- -ployee'to handle any lithographic work produced by such employer (struck work). The employer also agrees that he will not request any employee to handle any work in any plant if in another plant of any employer or of any subsidiary of such employer, any local of .Respondent International is on strike (chain shop). If the em- ' According to Senator Goldwater, the term "cargo" used in this connection is mis- leading as it gives the impression that the term involves only transportation activities. Actually, according to the Senator, the term "hot goods" is more descriptive. "'Hot goods' are goods which come from any enterprise or business or plant or establishment or factory which has a dispute with the union ." Legislative History of the Labor- Management Reporting and Disclosure Act of 1959, U.S. Government Printing Office (1959), p. 1829. ' Local 1976, United Brotherhood of Carpenters and Joiners of America , AFL, et al. (Sand Door A Plywood Co.) v. N.L.R.B., 357 U.S. 93. 6 Legislative History, op. cit. footnote 3 at 1708, 1829. AMALGAMATED LITHOGRAPHERS OF AMERICA (IND.) 9871 ployer requests an employee to handle any such work, the Union has the right to .terminate the contract forthwith (termination). The proposed " new . "trade shop", paragraph sets forth that the contract was negotiated on the assumption that all lithographic production work. will be done under approved union wages and conditions. If the employer requests any employee to, handle any lithographic work made in any shop not under contract-with the Lithographers and authorized to use the union label, the Union may reopen the contract, as to all terms and terminate it if no new agreement is reached. The union label must be affixed to all products. . Further, the employer agrees. not to discharge or discipline any employee who refuses to' handle any lithographic production work not made in a union shop` or in a shop authorized to use the union label, or who refuses to handle struck work (refusal to handle). A comparison of the admittedly now unlawful clauses in the 1957 contract with the Respondents' 1959 proposals reveals that their effect is substantially the same; and that they are no less effective than the former in accomplishing the same objective. Under the old provision, if an employer "required" an employee to work on production com- ing from, or destined for, an employer with whom the Lithographers was engaged in a strike, or to use any nonunion production work, the Union could terminate the contract forthwith. Under the new pro- posals the Union has the same right of contract termination on the happening of the same events. The words used are somewhat dif- ferent, the new proposals are more elaborate than the old, but their effect is precisely the same. It is plain enough that this is no for= tuitous happening, but a planned effort of draftsmanship. The Trial Examiner in fact found that the disputed clauses constitute a com- prehensive plan to achieve . the same results as the admittedly now illegal "trade shop" and "struck work" clauses in the 1957 contract. Accordingly, he found that, if agreed to, the new clauses would be unlawful under Section 8 (e).6 Respondents contend that the new clauses are not unlawful be- cause they do not constitute an "agreement, promise or commitment" to handle or not to handle the products of any other employer. Ac cording to Respondents, the new clauses leave to the discretion of the contracting employer whether he shall deal with, or in, the products of any other employer, union or nonunion, and do not require him to deal only with union employers. Section 8(e) bans "express or implied" hot cargo agreements. The term "implied" is used in. law. as contrasted with "express" when the "intention in regard to the subject matter is not manifested by explicit 0In the preceding Section 10 (1) injunction proceeding Judge Sweigert also found the proposed clauses unlawful . Gerald A. Brown v. Local No. 17, Amalgamated Lithographers of America (Ind:), 180 F. Supp. 294 (D.C..N. Calif.). '988 DECISIONS OF NATIONAL LABOR . RELATIONS BOARD'- and direct words, but is gathered by implication or necessary deduc- tion from the circumstances, the general language, or the conduct .of the parties." I When contracting parties have agreed that if an em- ployer requests an employee to handle struck or nonunion work, the Union shall have the right to terminate the contract, an ordinary remedy for a material breach of agreement by the other party. to a contract, and the employer agrees that he will not discharge or disci- pline an employee who refuses to handle such work, the ordinary remedy available against a disobedient employee, the conclusion is in- escapable, and we find, that the parties in substance have "impliedly" agreed that the employer will not handle such struck or nonunion work. An employer who is faced with the possibility of having his contract completely reopened if he handles struck or non-union work cannot realistically be said to act "voluntarily" in refusing to handle such work." Congress was not concerned with simply out- lawing word formulas in Section 8 (e). In the light of the hard facts, the circumstance that the word "agree" is not used, or that a statement is made that no contract express or implied is.intended, is meaningless. The statute cannot be avoided by so easy a means. Respondents offered to prove economic necessity in justification of their position that the disputed clauses be incorporated in the new collective-bargaining contract. The Trial Examiner. correctly re- jected such proffered testimony. Economic necessity cannot justify violation of the Act. An argument made on this basis should properly be addressed to Congress and not to the Board.9 Congress did except from the operation of Section 8 (e). certain contracts in the construc- tion, apparel, and clothing industries, because of conditions peculiar to those industries.10 The fact that Congress mentioned only those .industries in-its exceptions indicates that Congress did not intend that any other industry be exempted from its operations, whatever its alleged special economic problems. Moreover, the right of reopening in the proposed clauses is absolute; it is not in any way limited to situ- ations in which the solvency of the Union's welfare or pension funds is jeopardized. - - 7Black's Law Dictionary (4th ed. 1951 ), p. 888. See also 12 Am. Jur. 499. 8 Congress was well aware of the coercive effect of a reopening clause. In a prepared analysis of the Landrum -Griffin bill's secondary boycott and hot cargo provisions, Repre- sentative Thompson and the then Senator Kennedy said (Legislative History op. cit. footnote 3 at p. 1708) "It is very hard for a trucking firm either to resist the Teamsters ' demand for a hot cargo clause in collective bargaining, when the price of resistance would undoubtedly be a strike for still higher wages, or to refuse to live up to the contract once it has signed it, when the cost of noncompliance would undoubtedly be the Teamsters' in- sistence that the contract had been terminated by the violation , thus freeing the union to present new demands in collective bargaining." e N.L.R.B. v. National Maritime Union of America, et al., 175 F. 2d 686, 689-690 (C.A. 2), cert. denied 338 U.S. 954 , rehearing denied 339 U.S. 926. - 10 Legislative History op . cit., supra, footnote 3, pp. 3829-1830 . Congress was aware of the existence of "hot cargo" clauses in the printing industry (id. at p. 1581). AMALGAMATED LITHOGRAPHERS OF AMERICA (IND.) 989 Respondents make a number of contentions with respect to the individual clauses. They assert that the "struck work" proposal merely embodies the "ally" doctrine and is lawful.li We find, as did Judge Sweigert, that the proposal goes beyond the "ally" doctrine since it precluded the employer from doing not only farmed out work, but also work customarily performed by the contracting'employer for the struck employer. We also find, contrary to the Respondents' contention, that the "chain shop" clause standing by itself is unlawful. It not only per- mits a sympathy strike in one plant of an employer where another plant of the same employer is struck, but also permits a strike in the plant of the principal company where the plant of a subsidiary is struck or vice versa, even though the principal and subsidiary do not constitute a single employer within the meaning of the Act. The latter type of strike is unlawful under Section 8(b) (4).12 However, the strike be labeled, "sympathy" or otherwise, the effect of the "chain shop" clause is exactly like that of the "struck work" clause, at least insofar as company and subsidiary are separate employers within the meaning of the Act. Respondents argue that contracting parties have the right to ter- minate their contractual relations for any reason whatsoever, includ- ing the fact that either does not approve of the practices of the other. The Board is not concerned with private rights of contracting parties. Nor is the Board required to consider the "termination" clause in isola- tion. The "termination" clause in this case is the sanction intended to insure that the contracting employer will not handle certain "hot goods." As a component part of the implied agreement to achieve, an illegal objective, it partakes of that illegality. The considerations determining the illegality of the "termination" clause are equally applicable to the "refusal to handle" clause. 2. We agree with the Trial Examiner that one of the objects of the strike was to secure incorporation of the clauses in dispute in any new collective-bargaining agreement.13 This is established not only by statements made and the conduct of Respondents during the negotia- tions,l' but by the fact that agreement on terms of a new agreement 11 Douds v. Metropolitan Federation of Architects, etc. (Project Engineering Company), 75 F. Supp. 672 (S.D.N.Y. ) ; N.L.R.B. v. Business Machine and Office Appliance Me- chanics Conference Board, et at ., 228 F. 2d 553 (C.A. 2). 'J. G. Roy and Sons Company v. N.L.R.B., 251 F. 2d 771 (C.A. 1) ; Bachman Machine Company, a corporation v. N.L.R.B., 266 F. 2d 599 (C.A. 8). ' It is not necessary to find that the sole object of the strike was illegal . It is suffi- cient if an object of the strike was unlawful. N.L.R.B. v. Denver Building and Con- struction Trades Council, et at. (Gould & Pre-inner), 341 U.S. 675, 689. JA As found by the Trial Examiner : "In the course of these [ contract] negotiations the representatives of Local 17 stated that the contract proposals were the 'lifeblood' of the Union ; also that the contract proposals had been drawn by counsel for the International, and that the Association had to accept the proposals without change." We note also that in the Miami Amalgamated Lithographers case, 130 NLRB 968, decided this day, the Respondents stipulated that the incorporation of the clauses in question in a contract was one of the objects of the strike. 990. DECISIONS OF NATIONAL--LABOR - RELATIONS BOARD was reached comparatively quickly after Judge Sweigert issued his injunction in the 10(1) proceeding enjoining Respondents from enter- ing into any agreement which, included the - clauses, found- to be unlawful. 3. We also agree with the Trial Examiner that the Respondents violated Section 8(e) in signing extension agreements with non- members of the Association. On November 21, 1959, Respondent Local 17 notified nonmembers of the Association that its membership had passed a resolution per- mitting employers who were not Association members "to continue to work under the conditions of the master agreement" between the Association and Local 17 which expired on October 18, 1959, provided that the independents agreed to apply retroactively all conditions in any new agreement that might be signed with the Association. The independents named in the complaint signed a stipulation in the form submitted by Local 17 and the strike ended as to such employers. As previously stated, the recently expired Association contract contained now illegal "hot cargo" clauses. Local 17 contends that the extension agreement applied only to the economic conditions of the old agree- ment and not to the "hot cargo" clauses. Local 17's president testi- fied that this was the intent of the extension agreement. However, there is no such limitation either in the resolution or in the stipula- tion signed by the independents. Representatives of the' latter testi- fied that after signing the extension agreement they had. operated exactly the same way as they had under the old agreement, and that they had continued to use the union label under an agreement, a condi- tion of which is that all lithography must be done by members of the Lithographers, and another is that there is in effect a collective-bar- gaining agreement- between the Union and the Company.' On all the evidence, - we agree with the Trial Examiner that the illegal "hot cargo" . clauses were continued in effect by the extension agreements. Accordingly, we find- that Respondent Local 17 thereby violated Sec- tion 8(e) of the Act. - 4. The Trial Examiner found that not only did Respondents' strike violate Section 8(b) (4).(i) and (ii) (A), but- it also violated 8(b) (4) (i) and (ii) (B) as well. He reasoned that there are lithographic ccompanies`in the San Francisco-area whose employees are either.•un- ,organized or organized _by.-unions other than the Respondents- and that the strike, if successful, would have required the -Association =members to, cease doing business with such other lithographic em- ployers. Respondents contend that to establish an 8(b) (4) (B) - vio- lation. proof is necessary that they had requested or sought to have an employer- or - employers - discontinue the handling of certain prod- ucts or 'the doing business-with certain other persons. - We_.do not agree that Section .8 (b) (4) (B) requires evidence that the conduct AMALGAMATED . LITHOGRAPHERS OF-AMERICA (IND-) 991 complained of was aimed at --a' particular person. The inevitable effect of Respondents' strike, if it achieved its objective, would be to -limit business done by -members of the Association with shops whose employees were not organized by Lithographers. We can per-' ceive no basis for differentiating between a strike,'the effect of which would be to cause an employer- to cease doing business with employer A and a strike -which would cause a cessation of business with un- named employers who are members of a particular class. It seems to us that 8(b) (4) (B) 'was intended to reach the.broad as well as the Iiarrow effect: a Accordingly; we adopt ,the Trial : Examiner's finding of an 8(b').(4)'(B) violation '.15 . 5. We agree with the Trial Examiner that Respondents violated Section 8(b) (3) by- insisting upon the inclusion of the previously mentioned illegal clauses in the proposed collective-bargaining agree- ment.18 The complaint also alleged that Respondent Local 17 had violated Section 8(b) (3) by instructing employees not to work overtime be- cause a new collective-bargaining agreement containing terms and provisions demanded by Local 17 had not been executed by and be- tween Local 17- and the Association. After the hearing,. the General. Counsel moved to -dismiss this allegation in view of the Supreme Court's decision in the Prudential Insurance case.17 The Trial Ex- aminer denied the motion upon the ground that harassing tactics to. force the inclusion of unlawful provisions in a collective-bargaining contract constitute a failure to, bargain in good faith. At the oral argument, the General- Counsel stated-that he accepted.. the ruling of the Trial" Examiner: We agree with the Trial Examiner. A strike. to compel inclusion of illegal provisions in a contract is a violation of- 8(b) (3). A fortiori, a partial strike, *in this case a refusal to work- overtime, to accomplish the same objective is equally unlawful. - 6. Finally, Respondents contend that the Landrum-Griffin -Act is- unconstitutional.' The Board's position has always been that it must assume the constitutionality of the Act which it -is called upon to` administer, in the absence of it binding court decision to the contrary.18 Accordingly; we reject this argument of. Respondents. - 15 Member Fanning disagrees with his colleagues' finding that Section 8(b) (4) (B) was violated in these proceedings. In -his opinion , the General Counsel failed to prove that Respondent induced any individual , employed by any identifiable secondary employer in order to force such employer to cease doing business with the Charging Parties. As he believes that such proof is an indispensable element in finding a violation of that section, Member Fanning would, for' the reasons set forth in' his -dissenting opinion in American Federation of Television and Radio Artists, AFL-CIO ( L. B. Wilson, Inc. (Radio Station WCKY) ), 125 NLRB .786, dismiss this allegation' of the complaint. - 16 international Typographical : Union, AFL-CIO (Haverhill Gazette ) v. N.L.R .B.; 278 F. 2d 6 ( C.A..1), enfg. as mod. 123 NLRB.806. . 17N.L.R:B. v. Insurance- Agents' International-Union, AFL-CIO-( Prudential Ina. Co.),- 361 U.S. 477. 'e Rite-Form Corset Company, Inc., 75 NLRB 174. 992 DECISIONS` OF NATIONAL LABOR RELATIONS BOARD ORDER . Upon the entire record in this case and pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board hereby orders that : . A.. Respondent Amalgamated Lithographers of America, Local No. 17, San Francisco, California, its officers, representatives, and agents, shall : 1. Cease and desist from refusing to bargain collectively with The Employing Lithographers, a Division of the Graphic Arts Employers Association, as the bargaining representative of the employees of its employer-members in the appropriate unit, by insisting upon the in- corporation in any collective-bargaining agreement of provisions which violate Section 8 (e) of the Act, and in support of such insistence engaging in strikes or refusals to work overtime. B. Respondents Amalgamated Lithographers of America, and its Local 17, their officers, representatives, and agents, shall : 1. Cease and' desist from : (a) Engaging in, or inducing or encouraging any individual em- ployed by any person engaged in commerce or in an industry affecting commerce to engage in, a strike or refusal to -work overtime, or .threat- ening, coercing, or restraining any person engaged in commerce or in an industry affecting commerce, where in either case an object thereof is to force or require The Employing Lithographers, a Division of the Graphic Arts Employers Association, or independent lithographic firms in the San Francisco and Northern California area, to enter into any agreement which is prohibited by Section 8(e), or . forcing or requiring the aforesaid persons to cease using, selling, handling, trans- porting, or otherwise dealing, in the products of any other producer, processor, or manufacturer, or to cease doing business with any other person. (b) Entering into-any contract or agreement, express, or implied, with Schwabacher-Frey Co., Neal Stratford & -Kerr.; Vlerrill' Reed Lithographers, Hogan-Kaus Lithograph Co., or other independent lithographic firms in the San Francisco and Northern California area, whereby such employers cease or refrain or agree to cease or refrain from handling, using, selling, transporting, or otherwise dealing in any of the products of any other employer, or to cease doing business with any other person. 2. Take the following affirmative action, which the Board finds will effectuate the policies of, the Act: (a) Post in conspicuous places in Respondents' business offices, meeting halls, and places where' notices to members are customarily AMALGAMATED LITHOGRAPHERS ' 0 AMERICA ' ( IND.) 993 posted,.copies of the notice attached. hereto marked "Appendix A." 19 Copies of said notice, to be furnished by the Regional Director for the Twentieth Region, shall, after being duly signed by official repre- sentatives of Respondents, be posted by Respondents immediately upon receipt thereof and be maintained by them for 60 consecutive days thereafter. Reasonable steps shall be taken by Respondents to insure that said notices are not altered, defaced, or covered by any other material. (b) Furnish to the Regional Director for the Twentieth Region signed copies of the aforementioned notice for posting by members of the Association and Independents, if such companies agree, in places where notices to employees are customarily posted. Copies of said notice, to be furnished by the Regional Director, shall, after being signed by Respondents, as indicated, be forthwith returned to the Re- gional Director for disposition by him. _(c) Notify the Regional Director for the Twentieth Region, in writing, within 10 days from the date of this Decision and Order, of the steps taken to comply herewith. , 10In the event that this Order is enforced by a decree of a United States Court of Appeals, there shall be substituted for the words "Pursuant to a Decision and Order" the words "Pursuant to a Decree of the United States Court of Appeals,' Enforcing an Order." APPENDIX A NOTICE TO ALL OUR MEMBERS AND TO ALL EMPLOYEES OF THE EMPLOYING LITHOGRAPHERS, A DIVISION OF THE GRAPHIC ARTS EMPLOYERS ASSOCIATION, AND LITHOGRAPHERS & PRINTERS NA- TIONAL ASSOCIATION, INC., AND THE EMPLOYEES OF THE INDE- PENDENT LITHOGRAPHERS OF SAN FRANCISCO AND SAN MATEO COUNTIES, CALIFORNIA, INCLUDING SCHWABACHER-FREY Co., NEAL STRATFORD & KERB, MERRILL REED LITHOGRAPHERS , AND HOGAN- KAUs LITHOGRAPH Co. . Pursuant to a Decision and Order of the National Labor Relations Board, and in order to effectuate the policies of the National Labor Relations Act, we hereby give notice that : AMALGAMATED LITHOGRAPHERS OF AMERICA, LOCAL No. 17, WILL NOT refuse to bargain collectively with The Employing Lithographers, a Division of the Graphic Arts Employers As- sociation, as the bargaining representative of the employees of the Association's employer-members in the appropriate unit, by insisting upon the incorporation in any collective-bargaining agreement of provisions which violate Section 8(e) of the Act, and in support of such insistence engaging in strikes•or refusals to work overtime. 597254-61-vol. 130-64 994 DECISIONS OF NATIONAL LABOR RELATIONS BOARD AMALGAMATED LITHOGRAPHERS OF AMERICA, LOCAL No. 17, AND AMALGAMATED LITHOGRAPHERS .OF AMERICA, WILL NOT engage in, or induce- or encourage any individual employed by any person engaged in commerce or in an industry affecting commerce to- engage in, a strike or refusal to work overtime, or threaten, coerce, or restrain any person engaged in commerce or in an industry affecting commerce, where in either case an object thereof is to force or require The Employ- ing Lithographers, a Division of The Graphic Arts Employers Association, or'independent lithographic firms in the San Fran- Cisco and Northern California area, to enter into any agreement which is prohibited by Section 8 (e), or forcing or requiring the aforesaid persons to cease using, selling, handling, trans- porting, or otherwise dealing in the products of any other pro- ducer, processor, or manufacturer, or to cease doing business with any other person: - WILL NOT enter into any contract or agreement, express or implied, with Schwabacher-Frey Co., Neal Stratford & Kerr, Merrill Reed Lithographers, Hogan-Kaus Lithograph Co., or other independent lithographic firm in the San Francisco and Northern California area, whereby such employers cease or re- frain or agree to cease or refrain from handling, using, selling, transporting, or otherwise dealing in any of the products of any other employer, or to cease doing business with any other person. AMALGAMATED LITHOGRAPHERS OF AMERICA, Labor Organization. Dated ----- ------------ By------------------------------------- (Representative) (Title) LOCAL No. 17, AMALGAMATED LITHOGRAPHERS OF AMERICA, Labor Organization. Dated--------------- By------------------------------------- (Representative ) (Title) This notice must remain posted for 60 days from the date hereof, and must not be. altered, defaced, or covered by any other material. INTERMEDIATE REPORT AND RECOMMENDED ORDER STATEMENT OF THE CASE These proceedings, involving the three above-named consolidated cases, came on regularly to be heard by the duly designated Trial Examiner at San Francisco, Cali- fornia, on January 20-28 and February 1 and 2, 1960. At the hearing, the parties were represented by the counsel who were afforded a full opportunity to present evidence, examine and cross-examine witnesses,, and to present oral arguments on the issues. Upon the entire record and my observation of the witnesses , I hereby make the following: - AMALGAMATED LITHOGRAPHERS OF, AMERICA (IND.) FINDINGS AND CONCLUSIONS 1. THE BUSINESS OPERATIONS ,OF THE COMPANIES 995 A. The Association The Employing Lithographers, a Division of the Graphic Arts Employers Asso- ciation and Lithographers & Printers National Association, Inc., referred to herein as the Association, is a California corporation with its principal office and place of business in San Francisco, California. It consists of approximately 15 employer- members engaged in_lithography and related work and in the manufacture and sale of lithographic products with plants located in San Francisco and San Mateo Counties, California. The Association negotiates and enters into collective-bargaining agree- ments on behalf of its employer-members with labor organizations representing their employees. During the past year, in the course and conduct of their business operations, the employer-members of the Association purchased and received goods and materials which were shipped to their plants from sources outside the State,of California, valued in excess of $50,000. During the same period, the employer- members of the Association sold and shipped products from their plants to points located outside the State of California valued in excess of $50,000. In addition, during the same period, the employer-members of the Association sold .goods and rendered services valued in excess of $50,000 to business enterprises in the State of California, each of which annually ships 'goods and renders services valued in excess of $50,000 directly to purchasers outside the State of California. It is undisputed and I find that the Association is an employer within the meaning of Section 2(2) of the Act, and is engaged in commerce within the meaning of Section 2(6) and (7) of the Act. B. The Independents Also involved in this proceeding are approximately 120 independent lithographing firms with plants in San Francisco and northern California who are not members of the Association, or of any other employer organization. These individual employers are referred to herein as the independents. Among such independent lithographing firms are Schwabacher-Frey Co., Neal Stratford & Kerr, Merrill Reed Lithographers, and Hogan-Kaus Lithogaph Co., hereinafter referred to. as Schwabacher, Neal, Merrill, and Hogan. It is undisputed, and I find, that in the course of their operations 'Schwabacher, Neal, and Hogan each receive from, and ship to, points outside the State of Cali- fornia goods, materials, or products valued in excess of $50,000 annually, and similarly sell goods and services valued in excess of $50,000 to customers- within the State of California, each of which annually -ships goods' and renders services valued in excess of $50,000 directly to out-of-State purchasers. It is undisputed, and upon the record as a whole, I find, that Schwabacher, Hogan, and Neal are employers within the meaning of Section 2(2) of the Act, and engage in commerce within the.meaning of Section 2(6) and (7) of the Act. II. THE LABOR ORGANIZATIONS It is admitted in the pleadings and I find that Amalgamated Lithographers of America'(Ind.), herein called the International, and Local No. 17 of the Amalga- mated Lithographers of America (Ind), herein called Local 17, and collectively called the Unions, are and at all times material hereto have been labor organizations within the meaning of Section 2(5)-of the Act. III. THE REPRESENTATIVE CAPACITY. OF. LOCAL 17; THE APPROPRIATE UNITS It is likewise admitted, and I find, that for many years past Local 17 has been the recognized exclusive bargaining representative of the lithographic employees of the employer-members of the Association in an appropriate unit of production. em- ployees described as follows: All lithographic (direct or offset) production em- ployees, excluding sales, professional, sketch-artists, office and clerical, nonworking supervisors, and plant superintendents. It is likewise admitted and I find that for many years past Local. 17 has been the recognized exclusive bargaining representative of appropriate units of production employees of Schwabacher, Hogan, and Neal.. .. . The Issues Local 17, for many years past, has had contractual relations with.the Association and with the 100 and more employers here referred to as the Independents. The 996 DECISIONS OF NATIONAL LABOR RELATIONS BOARD. customary bargaining procedure has been for Local IT and the Association first to negotiate an agreement which.became the "master agreement," and which thereafter was adopted by each Independent and Local 17 by a separate and individual contract. It is the contention of the General Counsel that in- the 1959 bargaining negotia- tions between the parties, Local 17 with the approval, assistance, and support of the International, embarked on a course of conduct which violated the Act in several particulars. The General Counsel contends that in negotiations with the Association the Unions proposed and insisted on certain contract clauses which violated Section 8(e) of the Act, as amended. He also contends that the Union struck the Association to force the employers to accept these illegal clauses and that therefore the strike constituted a violation of Section 8(b) (4) (i) and (ii) (A) since it induced or en- couraged the employees to withhold their services and coerced and restrained the employers from carrying on their business operations, an object of such an action being to force the employers to enter into an agreement prohibited by Section 8(e). He also claims that the strike constituted a violation of Section 8(b) (4) (i) and (ii) (B) as well, since the inducement or encouragement and the same coercion and restraint had as an object forcing or requiring-members of the Association and other employers to cease doing business with employers whose employees were represented by no union, or by a union other than either of the Respondents. His basic contention, therefore, is that the contract demands constituted a demand that the employers enter into an agreement, express or implied, which would violate the terms of Section 8(e) of the Act. A second issue is premised on the fact that certain provisions of the expiring contract, which were not illegal prior to the effective date of the Landrum-Griffin Act, admittedly became illegal on and after that date. The General Counsel contends that this expiring contract was reinstated on or about November 21, 1959; when certain of the Independents signed a stipulation agreeing to "continue to work under the conditions of the master agreement . . . that expired on October 18, 1959," and by further agreeing to be bound by the provisions of such master agreement as would, ultimately result from negotiations between the Association and Local .17. A third contention of the General Counsel states that Local 17 violated Section 8(b)(3) of the Act by insisting upon the aforementioned contract clauses on and after October 12, 1959, and by instituting a ban against the performance of overtime by its members from the expiration date of the expiring contract. The Unions deny the commission of unfair labor practices, taking the position that (1) the securing of these particular contract clauses was not an objective of the strike, and therefore there could be no violation of Section 8(b) (4) (i) and (ii) (A) or ( B), and (2) in any event the contract clauses are not violative of Section 8(e). In addition to the above, the International has sought to attack the constitutionality of Section 8(e) in these proceedings. The Contract Clauses; the Strike It is not disputed that the expiring "master agreement," which preceded the events which led to this dispute, was executed by Local 17 and the Association on or about March 11, 1958, with the approval of the International and was effective retroactively to October 22, 1957, and subject to termination on October 18, 1959, on 60 days' notice. - At approximately the same date of execution, Local 17 entered-into an identical contract with the independent lithographic firms including Schwabacher, Neal, Merrill, and Hogan. On or about August 17, 1959, Local .17 gave 60 days' notice to the Association and its members as well as to Schwabacher, Neal, Merrill, and Hogan and the other independent lithographic employers, of its desire to terminate its existing contracts on October 18, 1959. At the same time, Local .17 requested the representatives of the Association to meet with representatives of Local 17 to negotiate a new contract. Negotiations between the parties were initiated on September 9, 1959, and continued to about November 20, 1959, during which period Local 17 and the Association held about 16 meetings and engaged in collective-bargaining negotiations. Com- mencing on or about October 12, 1959, Local 17, with the authorization and approval of the International, demanded that the Association agree to certain so-called "Trade Shop Work" and "Struck Work" clauses. These clauses are as follows: SECTION 22. Trade Shop Work: (a) The parties agree that all the terms of this contract have been negotiated on the assumption that all lithographic pro- duction work will be done under approved union wages and conditions. In the event any employer covered by this contract (requests any employee to handle any lithographic production work made in any shop which was not under con- AMALGAMATED LITHOGRAPHERS OF -AMERICA (IND.) 997 tract with the Amalgamated Lithographers of America and authorized -to use the union label of the Amalgamated, then the Union in its discretion by notice in writing, may re-open the contract as to that employer for negotiations as to the whole or any part thereof. In the event of failure to agree on all terms within ten days after such re-opening, the Union shall have the right to terminate the contract forthwith as to that employer by giving written notice. to such employer. (b) Union trade shops must affix the Union label on all their products before sending them to any other shop. (c) Finished lithographic press press plates which are sent out of any plant (unless for regraining) shall have the Union label and the name of the plant in the plate, except that as to plates heretofore made this may be done by otherwise attaching the Union label and name of the plant to the plate. Any negatives or positive sent out of a plant shall bear the Union label and the name of the plant. (d) Upon request by the shop delegate an employer shall advise him of the source of any lithographic work brought into the plant from the outside. Such request shall not interfere with the normal production of the plant. SECTION 23. Struck Work: (a) The Employers agree that they will not render assistance to any lithographic employer any of whose plants is struck by any Local of the Amalgamated Lithographers of American or the International or where members of any such Local or the International are locked out, and accordingly agree that in implementation of this purpose the employees covered by this contract shall not be requested to handle any lithographic work (other than work actually in process in the plant) customarily produced by- such employer. (b) The Employers agree that the employees covered by this contract shall not be requested to handle any work in any plant if in another plant of any employer or of any subsidiary of such employer in any part of the United States or Canada any Local of the Amalgamated Lithographers of America_ or the International is on strike or members of such Local or the International are locked out. - SECTION 24. Termination: In the event an employer requests any employee to handle any work described in paragraph (Section 23) above, or requests any employee to handle any work received from or destined for any employer involved in such strike or lockout, directly or indirectly (other than work actually in process in the plant), the Union, in addition to the other rights and remedies the employees and the Union have under this contract or the law, shall have the right in its discretion to terminate the contract forthwith as to that employer by giving written notice to said employer. SECTION 25. Refusal To Handle: The Employers agree that they will not discharge, discipline or discriminate against any employee because such employee refuses to handle any lithographic production work which was made in a shop not under contract with the Amalgamated Lithographers of America or not authorized to use the union label of the Amalgamated-or because such employee ,refused to handle any struck lithographic work of the type described in Sec- tions 23 and 24. _ The Association refused to agree to the proposed contract demands. Thereafter, in negotiations the parties were concerned with two principal items, •a raise in wages for the employees, and these contract demands of the Unions. In the 'course of these negotiations the representatives of Local 17 stated that the contract proposals were the "lifeblood" of the Union; also that the contract proposals had been drawn by counsel for the International, and that the Association had to accept proposals without change. However, it is clear from' the' testimony that at one point in the negotiations, the Unions proposed that the Association representatives attempt to draft suitable phraseology covering the subjects. However, the Association repre- sentatives were unable to contrive any language which would be suitable to the Unions. Finally the negotiations reached an impasse on or about November 20, 1959, and on November 23, 1959, the Unions instituted a strike of their members employed by. members of the Association and initiated picketing at the plants of the Association. As a result of the strike the companies ceased operations.' Upon all the evidence, I find that the strike had two principal objectives, the securing of the specific contract clauses in the new contract, and an increase in wages for the employees. While there were other issues of minor importance these were the two issues upon which the negotiations foundered and which became the subject of the Union's and the Association's economic struggle. 998 DECISIONS OF NATIONAL LABOR RELATIONS BOARD. Meanwhile, on October 26, 1959; Wayne C. Wade, executive secretary - of- the Association, had filed the original- charge in Case' No. 20-CB-728 against Local 17. On November 25, 1959, Wade followed up the first charge by filing a second charge in Case No.-20-CC-203 which named as respondents both Local 17 and the Inter- national and on the same date filed a third charge in 20-CE-1 against both Local 17 and the International. On December 7, 1959, the Regional Director, pursuant to Section 10(1), instituted -injunction proceedings in the District Court for the Northern District of California, Southern Division. On January 13, 1960, Sweigert, District Judge, issued a decree as follows: 1. Enjoining . respondents herein, (the unions ) pending further proceedings before the National Labor Relations Board, from entering into any agreement, express or implied, with the lithographic employer members of the Association, or with any of the so-called independent lithographic employers, in the terms of, or substantially similar thereto, those clauses herein referred to as the "Trade Shop" clause and the "Refusal to Handle" clause; or, in the terms of, or sub- stantially similar thereto, those clauses herein referred to as the "Struck Work" clause, the "Chain Shop" clause, and the "Termination" clause, unless with respect to the last three mentioned clauses clarification and revision is made and approved by the Court. 2. Enjoining,, respondents from engaging in, inducing, or encouraging any individual employed by any employer . members of the Association or' of 'the independent lithographic employers , herebefore mentioned, to engage in a strike or a refusal in the course of his employment, or to threaten, coerce, or restrain any person engaged in the lithographic industry , whether in the commerce of the employers' Association or the independent lithographic employers, where in either case an object thereof is to force or require any such employer to enter into any agreement containing. the terms of, or substantially similar thereto, the clauses above mentioned .:.:. •: 3. Reserving in the .Court power to terminate, modify, alter, amend, supple- ment, or otherwise change any temporary injunction issued herein, upon such further hearing and notice:as the Court.deems proper, and particularly, to con- sider and determine further;clarification-or revision of the "Struck Work" clause, the "Chain Shop" clause, and the "Termination" clause. On January 30, 1960, the Unions and the Association agreed upon the terms- of a new collective-bargaining contract and the strike was terminated. The Extension of the Expiring Contract by the Unions and Certain Independents It is undisputed that the expiring contract contained certain clauses which were in the nature of "hot cargo" clauses. These clauses which were not illegal before the effective date of pertinent sections of the Landrum-Griffin Act became a viola- tion of Section 8(e) on that date , November 13, 1959 . These clauses read as follows: SECTION 21. (a) Struck Work: It is mutually agreed that the employees will not be required to execute any lithographic production work (other than work actually in process in it plant) received from or dentined for any litho- graphic Employer or lithographic plant, whether by direct or indirect methods, with whom the Amalgamated Lithographers of America has a lockout or strike as a result of a dispute, of which the Company has been advised by the Union in writing. Furthermore, in the event an Employer shall execute any such work, in whole or in part, then the Union shall be entitled in its discretion to terminate this agreement forthwith as to such Employer by notice in writing. (b) Trade Shop: It is agreed that the employees will not be required to use any lithographic production work made in any shop which was not under contract with the Amalgamated Lithographers of America, unless such plant or trade shop heretofore has been supplying work as above specified produced in its plant to such Employer party to this contract and is not engaged in a strike or lockout with the Amalgamated Lithographers. of America. Further- more, in the event the Employer uses any such work in its plant, then the Union may in its discretion terminate this agreement as to such Employer forthwith in writing. ' - On November 21,.1959, the president of Local 17 wrote'the following letter to each of the Independents: GENTLEMEN: Please be advised that Local #17-Amalgamated Lithographers of America, at a special meeting held today, went on record as follows: AMALGAMATED. LITHOGRAPHERS OF AMERICA (IND:) 999 All lithographic paper and: trade shops not belonging to the Employing Lithographers Association of San Francisco may continue to work- under the conditions of. the master. 'agreement 'between. the Employing Litho- graphers Association of San Francisco and Local #17 Amalgamated Litho- graphers of America that' expired October 18, 1959; Provided that the enclosed Stipulation of Agreement is signed guaranteeing retroactivity back to October 19, 1959 to all conditions in the master agreement that will be signed between the Employing Lithographers Association of San Francisco and Local #17 ' Amalgamated Lithographers of America when negotiations are completed. - We are enclosing this Stipulation -of Agreement in duplicate, so please sign the two copies and return them to Local # 17's office by Thursday morning, November 26, 1959. This Stipulation of Agreement must be countersigned by Local #17 Amalgamated Lithographers of America. One copy will be re- turned to you promptly. Local #17 Amalgamated Lithographers of America will be required to take the necessary economic action against any, lithographic paper or trade shop that does not have this signed Stipulation of Agreement in Local #17's office by .Thursday morning, November 26, 1959.- With best wishes, Very truly yours, IvAN T. BRANDENBURG, -President Local #17. (G.C. Exhibit No. 33A) Attached to each letter was a copy of the following stipulation. STIPULATION OF AGREEMENT The undersigned parties,-hereby agree that there will be no work, stoppage at the undersigned plant, since the undersigned parties have agreed to sign and comply with any: and all conditions that will be negotiated by and between Local #17 Amalgamated Lithographers of America and the Employing Litho- graphers Association of San Francisco. Said conditions to be retroactive to October '19, 1959: Dated this ---------- day of November, 1959. ------------------------------------------ (Firm Name) By------------------------------------------ (For Management). Countersigned by Local #17 Amalgamated Lithographers of America By------------------------------------------ President-Local #17 Note: This Stipulation of Agreement must be signed in duplicate and both copies returned to Local #17's office (693 Mission Street, San Francisco 5, California) to be countersigned. . One signed copy will be returned to you promptly.- (G.C. Exhibit No. 33B), It is undisputed that on or about November 21, 1959, Schwabacher, Neal, Hogan, and Merrill, as well as other Independents, executed the above stipulation. There- after, their operations were continued in exactly the same manner as they were conducted before the expiration date of the contract dated October 22, 1957: .: . The Ban on Overtime It is likewise undisputed that on October 18, 1959, while negotiations were in process Brandenburg, president of Local 17, sent the following letter to the employer- members of the Association. EMPLOYING LITHOGRAPHERS ASSOCIATION OF SAN FRANCISCO. GENTLEMEN: At a special meeting held Sunday, October 18, 1959 the mem- bers of Local #17 Amalgamated Lithographers of America adopted the fol- lowing motion: . It was moved, seconded-and adopted unanimously that in view of the fact that our present contract expires midnight, October 18, 1959, members in the paper houses and trade shops- shall not work overtime unless the terms of a new contract shall be negotiated satisfactorily before midnight 1000 DECISIONS OF NATIONAL LABOR RELATIONS BOARD. October 21 ; 1959, and that any members violating this provision shall be subject to charges. The foregoing does not apply to tin houses. Enclosed is our proposed new contract. With best wishes, Very truly yours, (General Counsel Exhibit No. 37). It is also undisputed that on the same date the following special bulletin was dispatched to shop delegates , for posting on employee bulletin boards. SPECIAL BULLETIN OCTOBER 18, 1959 SHOP DELEGATES * PLEASE POST ON BULLETIN BOARD. #############$##############$#$$$$$$$$ DEAR MEMBER: The- following letter has been sent , to all paper house and trade shop employers: "At a special meeting held Sunday, October 18, 1959 the members of Local # 17 Amalgamated Lithographers of America adopted the following motion: "It was moved, seconded and adopted unanimously that in view of the fact that our present contract expires midnight, October 18, 1959, members in the paper houses and trade shops shall not work overtime unless the terms of a new contract shall be negotiated . satisfactorily before midnight October 21, 1959, and that any members violating this provision shall be subject to charges. "The foregoing does not apply to tin houses." Fraternally hours, [S] Ivan T. Brandenburg, IVAN T. BRANDENBURG, " President, Local #17. (General Counsel Exhibit No. 36). It is undisputed that after that date the members of Local 17 refused to perform any overtime. work.. The Evidence Ruled Inadmissible At the hearing a large number of documents and a substantial quantity of oral testimony were excluded from evidence by certain rulings of the Trial Examiner. These rulings - arose from two separate -contentions of counsel for the Unions upon proper objections by the General Counsel. In various discussions on the record, counsel and the Trial Examiner worked out a modus.operandi, whereby all docu- ments ruled inadmissible herein were identified, numbered, and filed in a special file of rejected exhibits. Where counsel deemed it appropriate, they made offers of proof, which the Trial Examiner heard and rejected. It. was, the purpose of all counsel and the Trial Examiner by this procedure to present all the contentions of the parties in such fashion that each could be fully understood and reviewed by the Board and the courts. ' A large amount of this evidence, ruled inadmissible, arose from the Union's desire to challenge the constitutionality of Section 8(e) of the amended "Act. It should be noted in this regard that this" section contains two provisos, the first of which exempts the construction industry- from the application of Section 8(e), and the second of which exempts the apparel and clothing industry from the application of both Section 8(e) and 8(b)(4)(B). Counsel for the Union did not seek in this proceeding to attack the exemptions thus granted, but sought to introduce evidence to show that both the lithographic industry and the garment industry have similarly integrated processes of production, and -that therefore the lithographic industry should have been granted the same exemption as the garment industry, and to the extent that it was denied such exemption , Section 8(e) was unconstitutional. as a violation of the due process clause of the fifth amendment to the Federal Constitution. To support this argument, counsel for the Unions sought to introduce evidence as to the 'integrated nature of the lithographic business- as conducted in the United States. The General Counsel objected to the receipt of any evidence directed to showing the integrated nature of the lithographic industry anywhere, on the ground that such proof was irrelevant , and beyond the scope of the hearing, since constitu- AMALGAMATED LITHOGRAPHERS OF AMERICA (IND.) 1001 tional questions relative to the Act are matters for the courts, and not for.the-Board or its Trial Examiners. The Trial Examiner sustained the General Counsel's objec- tion,) but ruled that he would accept evidence directed to showing the integrated nature of the lithographic industry as conducted by the employers involved in the instant proceeding, inasmuch as the nature of the lithographic business was inextrica- bly involved in the bargaining between the Association and the Unions, an important subject for examination in this proceeding. Both the General Counsel and counsel for the Unions noted exceptions to the ruling of the Trial Examiner, and thereafter counsel proceeded by the modus operandi explained above, noting appropriate exceptions. Also, a large amount of evidence, ruled inadmissible, arose from the desire of counsel for the Union to introduce evidence directed to showing that the reopening provision of the "Trade Shop" clause (section 22) was not an implied agreement not to use a nonunion trade shop, but was a legitimate reopening clause to serve a legitimate purpose, namely, to readjust such economic factors in the relation-of the parties as the existing pension fund, the health and welfare fund, and apprentice programs, etc. The General Counsel again objected on the ground that the fact that the clause might serve some legitimate purpose was not a valid defense to the charge that it violated the Act. The Trial Examiner ruled that the evidence was inadmissible, on the ground that the contract clauses had to be judged upon the language of the clauses themselves, and the-obligations of the parties, which they created. Counsel for the Unions noted their exception to this ruling, and thereafter made numerous offers of proof which were rejected. However, the Trial Examiner received in evidence copies of the current pension fund and health and welfare fund, on the ground also that they were unextricably involved in the bargaining of the parties? Concluding Findings As set forth previously the basic question here presented for resolution is whether the contract clauses numbered 22, 23, 24, and 25 constitute a contract or agreement, express or implied, whereby the employers would cease or refrain or agree to cease or refrain from handling, using, selling, or otherwise dealing in any of the products of, or to cease doing businesst with, another employer, within 'the meaning of Section 8(e) . Before turning to a consideration of the specific clauses here in question, it may be well to review briefly the background to the new Section 8(e).• In 1947 Congress passed the Labor Management Relations Act, commonly re- ferred to as the Taft-Hartley Act. This Act enacted a new Section 8(b)(4) as an addition to the National Labor Relations Act. It made a secondary boycott an unfair labor practice to the extent that it prohibited a labor organization from en- gaging in, or inducing or encouraging employees to engage in, a strike or concerted refusal to handle goods or. perform services, with the object of forcing or requiring an employer or other person to cease handling the products of another or to cease doing business with any other person. The declared purpose of this secondary- boycott legislation was to narrow the area of industrial disputes, so as to confine them to those immediately interested and to prevent their extension to employers and em- ployees not directly involved, all in the public interest. Shortly after the enactment of that legislation various unions developed the prac- tice of bargaining with employers for inclusion in collective-bargaining agreements of so-called hot cargo clauses. There have been various definitions of hot cargo agreements. One states that as used by a labor union, the term "hot cargo" refers to goods produced or shipped by an "unfair" employer. In such a context, accord- ing to the definition, the term "unfair" may refer to a struck employer, or to an employer whose goods bear no union label, or to an employer whose wages or other working conditions are deemed substandard by the union. By the hot cargo con- tracts the unions sought to preserve for their members the right to refuse to handle or process any goods, merchandise, or cargo of which the union did not approve. The legality of these contracts and 'their enforcement under. the Taft-Hartley Act had to be judged under the technical language of the Section 8(b) (4) (A) of the secondary boycott prohibition. As pointed out by the Supreme Court in 'Local 1976, 1 Rite-Form Corset Company, Inc., 75 NLRB 174, 176; Schenley Distillers Corporation, 78 NLRB 504, 507; Wadsworth' Building Company, Inc., et al., 81 NLRB 802, 806. 2 See offers of proof through witness Ivan T. Brandenburg and Kenneth Brown, presi- dent of International. 1002 DECISIONS OF NATIONAL LABOR RELATIONS BOARD . United Brotherhood of Carpenters and Joiners of America, AFL'v. N.L.R.B. (Sand Door & Plywood Co.), 357 U.S. 93, this section had a checkered career in the deci= sions of the Board. In its' first resolution of the question, the Board decided that' neither the signing nor the enforcement of a hot cargo contract violated the law. This decision was upheld by the United States Court of Appeals at New York.3 Six years later the Board took a second look at the issue and modified its position; Although there was a three-way split among the five members there was a majority for these rulings: . (I). There is nothing unlawful in a union executing a hot cargo agreement appeal= ing directly to the employer to abide by it. (2) However, any appeal to the employees. to strike • or to refuse to handle the "unfair" goods in a situation otherwise within the prohibition would be a violation; the hot cargo agreement would not provide a defense. This doctrine was later upheld by the Supreme Court in the Sand Door case (supra). On September 14, 1959, the Congress considered and passed the Landrum-Griffin bill of which Section 8(e) was designed to. close what both House and Senate Com mittees described as a "loophole" in the existing secondary boycott law. This legis- lation revised the preexisting secondary boycott provisions, now Section 8(b)(4)(i) and (ii), and enacted the new Section 8(e). The last-named section, which was aimed at prohibiting hot cargo agreements, was broad in scope and written in the plainest of language. This section is reproduced here, together with the provisos to the section, for the exemptions of the provisos illustrate that Congress sought to reach every type of hot cargo agreement by its prohibition. SEC. 8. (e) It shall be an unfair labor practice for any labor organization and any employer to enter into any contract or agreement, express or implied; whereby such employer ceases or refrains or agrees to cease or refrain from handling, using, selling, transporting or otherwise dealing in any of the products of any other employer, or to cease doing business with any other person, and any contract or agreement entered into heretofore or hereafter containing such an agreement shall be to such extent unenforcible and void: Provided, That nothing in this subsection (e) shall apply to an agreement between a labor organization and an employer in the construction industry relating to the con- tracting or subcontracting of work to be done at the site of the construction, alteration, painting, or repair of a building, structure, or other work: Provided further, That for the purposes of this subsection (e) and section 8(b) (4) (B) the terms "any employer", "any person engaged in commerce or an industry affect- ing commerce", and "any person" when used in relation to the terms "any other producer, processor, or manufacturer", "any other employer", or "any other person" shall not include persons in the relation of a jobber, manufacturer, .contractor, or subcontractor working on the goods or premises of the jobber or manufacturer or performing parts of an integrated process of production in the apparel and clothing industry: Provided further, That nothing in this Act shall prohibit the enforcement of any agreement which is within the foregoing exception. From a study of Section 8(e) ,and especially • the proviso granting exemption to the garment - industry, and the arguments of counsel for the Unions, it is apparent that the Unions find the prohibition of Section 8(e) especially onerous in the litho- graphic industry. In consequence, the Unions advance two principal arguments in this proceeding. (1) The operations of the lithographic business encompass rela- tions between lithographic firms, similar to the relations of jobber, manufacturer, contractor, subcontractor in the garment industry. Their first argument, based on the integrated nature of the lithographic process, is designed to challenge the consti- tutionality of Section 8(e).' This "first argument must be passed to the courts. . However, the second argument, which is a variation of the first, is that the lithographic industry is so integrated, so complex, and its labor relation so compli- cated, that the Unions need the right to reopen and terminate their contracts in the event employers handle unfair products or struck work. It seems to me, in the, light of all the evidence, that the Unions' seek to obtain by these contract 'clauses the exemption to Section 8(e) which Congress granted to the garment industry' withheld from the lithographic industry. ' Let us turn to an examination of the clauses. s International Brotherhood of Teamsters, etc. (Henry V: Rabouin, d/b/a Conway's Express ), 87-NLRB 972, 195 F. 2d 906 (C.A: 2). ' . ` • - ' AMALGAMATED LITHOGRAPHERS OF AMERICA ( IND.) 1003 The contract which expired 'had hot cargo clauses, in Section 21(a) "Struck Work" and Section 21(b) "Trade Shop," which provided that the employer could not "require" his employees (a) to execute any lithographic work, other than work actually in process in his plant, received from or destined for any lithographic employer with whom Amalgamated had a strike ; nor (b) to use work made in any shop not under contract with Amalgamated . In the event an employer executed or used any such work, the Union in its discretion could terminate the agreement as to such employer. These provisions in the 1958 contract constitute an admittedly illegal hot cargo clause under the new Section 8(e). The new clauses are intended to be a replacement. In my opinion, the new clauses constitute a comprehensive plan for attaining the same result. The provisions may not be considered in isolation , for' they form a well-conceived plan, which effects a boycott of non -union materials and em- ployers. An analysis of the four clauses discloses an agreement- . (1) That all terms of the contract "have been negotiated on the assumption that all lithographic work will be done under approved union wages and conditions" (Section 22a). This assumption, basic to the entire contract, must be considered in the light of the hot cargo clause of the expiring contract . After several years of operation under the previous hot cargo clause this assumption has the effect of freezing the employers' operations in the pattern of the now illegal contract. In other words, it is assumed, and the assumption becomes an agreement on execution of the contract, that the employer will, not take advantage of the new freedom in operations granted him under the new provisions of the Act, but will continue his operations as if the old hot cargo clause was still in effect. ' Following sections then spell out with specificity how the employer shall conduct himself toward "unfair" goods, or "unfair" employers ' and "unfair" employees, and impose a penalty or forfeiture upon his failure to so conduct himself. (2) The employers will not render assistance to any lithographic employer any of whose plants is struck by Amalgamated or by any affiliated local (Section 23a). (3) The Union in its discretion may reopen and renegotiate the contract as to a particular employer and terminate the contract in 10 days on failure to agree, if any employer covered by the contract requests any, employee to handle any litho- graphic production work made in any shop not under contract with Amalgamated and authorized to use its union label (Section 22a). (4) The employers will not request their employees to handle any lithographic work, other than work . actually in process in the plant , customarily produced by any lithographic employer, any of whose plants is struck by Amalgamated or by any affiliated local (Section 23a). (5) The employers will not request their employees to handle any work in any plant, if in another plant of any employer or of-any subsidiary of such employer wherever located, Amalgamated or any affiliated local is on strike (Section 23b). (6) The Union in its discretion may terminate the contract forthwith as to a particular employer if he requests any employee to handle the so-called struck work described in section 23, or to handle any work received from or destined for any employer involved in such strike, other than work actually in process in the plant (Section 24). (7) The employers will not discharge , discipline, or discriminate against any employee for refusing to handle any lithographic production work made in a shop not under contract with Amalgamated or not authorized to use the Amalgamated's union label or because it is "struck lithographic work of the type described in Sec- tions 23 and 24" (Section 25). As part of the ' plan, the contract requires work performed by members of Amalgamated to bear the union label (Section 22b, 22c) and for the employer to advise the Amalgamated's shop delegates of the source of any lithographic work brought into the plant from the outside (Section 22d).' While the validity of these last-mentioned provisions is not here questioned, taken in conjunction with the remainder of the four sections , they disclose a well-improvised plan' to effect a boycott of nonunion and unfair materials, plants , and 'employers. ' As noted previously certain sections carry their own sanctions . In section •22(a) "Trade Shop Work" provides that in the event an employer requests an employee to handle any lithographic work made in a shop not under contract with the Union, then the Union may "reopen" the contract as to that employer for renegotiation of the whole contract, or any part thereof. Failing to agree within .10-days to new terms, the Union may terminate the contract . Also, section 24 states that in 'the .event an 'employer , requests any employee to handle any work described in section 1004 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 23 (Struck Work) the Union shall have the right to terminate the contract forthwith. Counsel for the Unions contend that the reopening and termination provisions are not penal in their nature, but are necessary and lawful provisions for the pro- tection of the welfare of their members, because of the highly complicated pension funds, health and welfare funds, apprentice plans, etc., which exist in this highly technical industry. The General Counsel sees these provisions quite differently. He argues that any employer who executes such a contract as this will certainly cease and refrain from using nonunion material or doing business with nonunion shops, and he sees the clauses as a new form of hot cargo agreement. On this point, Judge Sweigert in his opinion in the injunction proceedings summed up the situation in very clear language .4 In its effort to interpret the "Trade Shop" clause properly and to relate it to Section 8(e), the Court has also considered the previously mentioned "Sand Door" case, supra, in which the Supreme Court, although holding secondary boycott clauses to be legal under then existing law, went on to hold that, nevertheless, such clauses would not justify, or constitute a defense to, eventual illegal inducement of employees to strike or refuse to handle goods with the object of forcing employers to abide by their previous agreement not to do business with non-union or struck third parties. In reaching this conclusion, the Supreme Court, although it was there deal- ing with a somewhat different phase of the secondary boycott problem, recog- nized the "realities" that must be taken into consideration in order to' interpret and apply legislation pertaining thereto. Speaking for the Court, Mr. Justice Frankfurter said: "A voluntary employer boycott does not become prohibited activity simply because a hot cargo clause exists . But there remains the question whether the employer has in fact truly sanctioned and supported the boycott, and whether he has exercised the choice contemplated by the statute. The potentiality of coercion in a situation where the union is free to approach the employees and induce them to enforce their contractual rights by self-help is very great. Faced with a concerted work stoppage already in progress, an employer may find it substantially more difficult than he otherwise would to decide that busi- ness should go on as usual and that his employees must handle the goods. His `acquiescence' in the boycott may be anything but free. In order to give effect to the statutory policy, it is not unreasonable to insist, as the Board has done, that even when there is a contractual provision the union must not appeal to the employees or induce them not to handle the goods. Such a rule expresses practical judgment on the effect of union conduct in the framework of actual labor disputes and what is necessary to preserve to the employer the freedom of choice that Congress has decreed. On such a matter the judgment of the Board must be given great weight, and we ought not set against it our estimate of the relevant factors." 357 U.S. at page 107. It should be noted that the only difference in terminology between the sec- ondary boycott provision of the old contract, which admittedly became illegal on November 13, 1959, and the revised provision demanded for inclusion in the new contract is that, while in the former the employer expressly agreed that he would not require his employees to handle "unfair" work, in the revised form the employer agrees that if he should so request his employees, then the union can, if necessary, terminate the contract. Of course, slight differences in draftsmanship often call for important differ- ences of interpretation, but in the present case it seems clear that the employers' agreement to such a condition of the contract is in itself "an agreement, ex- press or implied, whereby such employer * * * refrains * * * from handling * * * or dealing * * *" within the meaning of Section 8(e) as written and enacted by the Congress. To say that an employer, who has agreed that the continual operation of all the important terms secured to him by a collective bargaining agreement will depend upon the continuation of a chosen decision or policy not to deal with certain other employers, does not thereby "refrain" from dealing with such other employers would be to disregard the "realities" referred to by the Sup- reme Court. 'Gerald A. Brown v. Local No. 17, Amalgamated Lithographers of America, et at., 180 F. Supp. 294 (D.C. N. Calif.). " AMALGAMATED LITHOGRAPHERS OF AMERICA (IND.) ' 1005 That would be to hold, in effect, that newly won, and possibly hard won, rights of great importance to the employer, are not realistically related to the strong motivations of self-preservation that shape his choice and determine his conduct. Considered in the.light of human nature and the practical realities of labor management relations, there exists such intimacy of relation between an employer's valuable contract position and operating situation on the one hand, and his decision to refrain from. doing business with other employers on the other hand, that such choice as he may exercise is not' free, but forced. With this conclusion of Judge Sweigert, I am in complete agreement. For all the reasons stated above, therefore, I find that the "Trade Shop Work," "Struck Work," "Termination," and "Refusal to Handle" clauses constitute an agreement proscribed by Section 8(e) of the Act. From the findings above it follows that the strike of November 23, 1959, violated Section 8(b) (4) (i) and (ii) (A), for the securing of the contract provisions which violated Section 8(e) was one of the objects of that strike.5 The record also establishes that there are lithographic companies in the San Fran- cisco Bay area whose employeesare not organized in any union, or are organized by unions other than the Respondents herein, such as the International Printing Pressmen's Union and the Bookbinders Union. These constitute a well-defined and identifiable group of employers with whom the Association members were obliged to cease or refrain from doing business by the strike of the Unions. There- fore I find that the strike of November 23, 1959, also violated Section 8(b)(4)(i) 'and (ii)(B), as well. It is not disputed that the hot cargo provisions of the expiring contract were viola- tive of Section 8(e) of the amended Act. Therefore, I find that the Unions violated Section 8(e) when they executed a stipulation with the Independents, including Schwabacher-Frey Co., Neal Stratford & Kerr, Merrill Reed Lithographers, and Hogan-Kaus Lithograph Co. to extend the expiring contract. The Unions argue that the purpose of the stipulation was,,to extend, only the economic- provisions of that contract. Unfortunately, however, no such .limitation was included in the stipula- tion, and as it reads can only be interpreted as a general extension of the expiring contract. I also find that Local 17 violated Section 8(b)(3) of the Act by insisting upon the illegal clauses on and after October 12, 1959. The evidence establishes that at the meeting of representatives of the parties on that date, Local 17 insisted that the Association accept the clauses. Local 17 remained adamant on that point until the day after the injunction was granted by the district court. This constituted a demand that the employers agree to commit an illegal act. While it is true that the Landrum- Griffin amendments did not become effective until November 13, 1959, the parties in their bargaining contemplated a contract that would extend beyond the effective date of the new laws. In that context of circumstances, the insistence on incorpo- rating into the contract a provision illegal under the new laws was' an act of bad faith and a violation, of Section 8(b) (3) . of the Act. The consolidated complaint also alleges that Local 17 violated Section 9(b)(3) by 'instituting an harassment tactic, the overtime work ban. In his brief, the General Counsel moved for the dis- missal of the allegations of the consolidated complaint pertinent thereto, on the 5 Section 8(b) : "It shall be an unfair labor practice for a labor organization or its agents- • s • s s s • "(4)(i) to engage in, or to induce or encourage_any individual employed by any per- son engaged in commerce or in an industry affecting commerce to engage in, a strike or a -refusal in the course of his employment to use, manufacture, process, transport, or otherwise handle or work on any goods, articles, materials, or commodities or to perform any services ; or (ii) to threaten, coerce, or restrain any person engaged in commerce or in an industry affecting commerce, where in either case an object thereof is : ' "(A) forcing or requiring any employer or self-employed person to join any labor or employer organization or to enter into any agreement which is prohibited by section 8(e) ; "(B) forcing or requiring any person to cease using, selling, 'handling, transporting, or otherwise dealing in the products of any other producer, processor, or manufacturer, or to cease doing business with any other person, or forcing or requiring any other employer to recognize or bargain with a labor organization as' the representative of his employees unless such labor organization has been certified as the representative of such employees under the provisions of section 9: Provided, That nothing contained in this clause (B) shall be construed to make unlawful, where not otherwise unlawful, any pri- mary strike or primary picketing;" 1006 DECISIONS, OF NATIONAL- LABOR RELATIONS BOARD. basis of the Supreme Court's decision in N.L.R.B. V. Insurance- Agents' International Union, AFL-CIO (Prudential Ins. Co.), 361 U.S. 477.• However, I do not read that decision as: being dispositive of this allegation of the complaint. In the Insurance Agents .case, the harassment of the employer was held not violative, of the.Act, because the union was pursuing a lawful objective, a legal contract, in collective bargaining. Here, Local 17 by its overtime ban sought to harass the Association into a contract violative of Section 8(e). Certainly, harassing tactics designed to attain such an.objective are acts of bad faith and constitute a further violation of Section 8(b)(3). 1 so find. The General Counsel's motion for dismissal of this allegation is therefore denied. . IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The'unfair labor practices of the Unions described in section III, above, occurring in connection with the operations of the Association and the Independents described in section I, above, have a close, intimate, and- substantial relation to trade, traffic; and commerce .among the several States, and tend to lead to labor disputes burden- ing and obstructing commerce and the free flow of commerce... V. THE REMEDY Having found that the Unions - have committed unfair labor practices I shall recommend that they cease and desist therefrom and take certain affirmative action designed to effectuate the policies of the Act:- - Upon the basis of the foregoing findings of fact and on the entire record in this proceeding, I make the following: CONCLUSIONS OF LAW 1. Amalgamated Lithographers of America (Ind.) and Local No. 17 of the Amal- gamated Lithographers of America (Ind.) -are and at all times material to this' proceeding have' been labor organizations within the meaning of Section 2(5) of the Act. 2. The Employing Lithographers, a Division of the Graphic Arts Employers Asso- ciation, and the Lithographers & 'Printers National 'Association, Inc.;, Schwabacher- Frey Co., Neal Stratford & Kerr, Merrill Reed Lithographers, and Hogan-Kaus Lithograph Co., are and at all times material herein were employers within the meaning of Section 2(6) and (7) of the Act. 3. At all times pertinent hereto Local 17 was, and is, the exclusive bargaining representative of the employees in production units of the employers named above. 4. By-engaging in a ,strike to secure a collective-bargaining agreement, certain provisions of which violated Section 8(e) of the Act, the International and Local 17 engaged' in unfair labor -practices within the meaning of Section 8'(b)'(4)'(i) and (ii) (A) and Section 2(6) and (7)'ofthe Act. ' 5. By engaging in a strike to coerce the employer-members of the Association to cease doing business with certain other employers in the San Francisco Bay area, whose employees were and are not now members of the Union, the International and Local 17 ' engaged in unfair labor practices within the meaning, of Section 8(b)(4)(i) and (ii )(B) andSection2(6) and'(7) of the Act. - 6. By agreeing with the Independents, including Schwabacher-Frey Co., Neal Stratford & Kerr," Merrill Reed' Lithographers, and Hogan-Kaus Lithograph Co., to permit them to continue to operate pursuant to the contract between Local 17 and the Association. above named, which expired on October 18, 1959, the ,Inter- national and Local 17 have engaged-in unfair,-labor practices in violation'of Section 8(e) of the Act. . " T. By instructing its members employed by employer-members of the Association' not to perform-overtime work, and by striking to secure the inclusion of certain: clauses found to be violative of Section 8(e) of the Act, in a new contract between Local -1.7 and the Association, Local 17. has engaged in unfair labor practices ' in violation of Section 8(b) (3) and 8' (b) (i) (A) of the Act. - 8. The aforesaid unfair labor practices are unfair labor practices affecting com- merce within the, meaning of Section 2(6) and (7) of the Act. ' [Recommendations omitted frommpublication.] '