United Mine E\Workers of America

UNITED MINE WORKERS OF AMERICA United Mine Workers of America and Lone Star Steel Company and Surface Industries, Inc. Cases 16- CB-924, 16-CC-517, and 16-CC-518 August 24, 1977 DECISION AND ORDER BY CHAIRMAN FANNING AND MEMBERS JENKINS, MURPHY, AND WALTHER On January 28, 1976, Administrative Law Judge James L. Rose issued the attached Decision in this proceeding. Thereafter, the General Counsel, both Charging Parties (Lone Star Steel Company and Surface Industries, Inc.), and the Respondent Union filed exceptions and supporting briefs. Answering briefs were filed by Lone Star and the Respondent Union. The Board has considered the record and the attached Decision in light of the exceptions and briefs and has decided to affirm the rulings, find- ings,' and conclusions of the Administrative Law Judge, as modified herein.2 We agree with the Administrative Law Judge that the Respondent Union did not engage in proscribed secondary conduct by picketing the operations of Surface Industries at the Pocahontas mine in an effort to force Lone Star Steel Company to accept its bargaining demands, as Surface Industries is an ally of Lone Star in the latter's labor dispute with the Union. Likewise, we agree that the Union did not engage in unlawful conduct by striking to compel Lone Star's acceptance of the "successorship" clause as contained in the National Bituminous Coal Wage Agreement of 1974. We disagree, however, with the Administrative Law Judge's holding that the Union refused to bargain in violation of Section 8(b)(3) of the Act insofar as it sought, by striking, to gain Lone Star's acceptance of the "application of contract" clause, as in our view the subject matter of that clause constitutes a mandatory subject of bargaining. The relevant facts, more fully set forth in the Administrative Law Judge's Decision, are briefly summarized below. I Surface Industnes, Inc.. has excepted to certain credibility findings made by the Administrative Law Judge. It is the Board's established policy not to overrule an Administrative Law Judge's resolutions with respect to credibility unless the clear preponderance of all of the relevant evidence convinces us that the resolutions are incorrect. Standard Dry Wall Products, Inc., 91 NLRB 544 (1950), enfd. 188 F.2d 362 (C.A. 3, 1951). We have carefully examined the record and find no basis for reversing his findings. 2 The Charging Parties filed requests for oral argument. Their requests are hereby denied as, in our opinion. the record in this proceeding, including the parties' briefs, adequately presents the issues and the positions taken with respect thereto. :' The record shows that Lone Star had likewise been directly engaged in 231 NLRB No. 88 Lone Star Steel Company is a Texas-based manu- facturer of steel products, principally pipe used in the oil and gas industry. In connection with its business, Lone Star consumes 36,000 to 40,000 tons of coal per month to make coke which, in turn, is used in the steelmaking process. Coal is obtained both from outside suppliers and from coal lands owned or leased by Lone Star, the latter being a part of the Company's bituminous coal reserves, which are maintained to assure an adequate supply of this vital raw material. In January 1972, Lone Star acquired the Starlight mine near McCurtain, Oklahoma, for immediate exploitation of its bituminous coal of medium volatility. This was done to offset the loss of coal theretofore furnished by an outside supplier. Follow- ing this acquisition, and for more than 1 year, Starlight coal was mined by the River Corporation, under a contract with Lone Star. Work at the mine was covered by the terms of the 1971 National Bituminous Coal Wage Agreement, to which the River Corporation was a signatory. In April 1973, Lone Star itself took over operations at the Starlight mine and assumed, with some minor variances not here relevant, the aforesaid agreement which was terminable on or after November 12, 1974. 3 About the same time, Lone Star began investigat- ing other coal properties with a view toward acquisition of additional reserves, as a hedge against loss of high volatility coal sources which were deemed to be in questionable supply.4 Investigations centered on certain coal lands near Dow, Oklahoma, otherwise known as the Pocahontas prospect. On October 15, 1973, the Company entered into a 10- year renewable coal lease with the owner of those lands and in February of the following year began clearing the property to prepare it for mining. During the spring and summer of 1974 Lone Star entered into negotiations with potential mine operators and in July contracted with All Service Contractors, Inc., to mine the Pocahontas prospect.5 This agreement aborted, however, as All Service was unable to obtain financing for required machinery and equip- ment and begin production within the specified time. Thereafter, a similar agreement was signed with Murray Construction Co., Inc., on October 22, 1974. mining operations near Dow. Oklahoma, from the end of World War II through 1962. 4 Lone Star uses a blend of medium and high volatility coal in its coking ovens. 5 According to his credited testimony, Johnny Enlow, a founder and vice president of All Service. inquired of Lone Star officials in the course of these negotiations, why they did not "do the jobs themselves because they had the men, the money, and machines to do the jobs . . . and thereby cut out the middle man." They advised Enlow that Lone Star sought an independent rmne operator to assure continuous production in the event of an anticipated strike by UMWA employees upon termination of the current wage agreement on November 12. 573 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Subsequently, with Lone Star's approval, this con- tract was assigned to Surface Industries, Inc., a spinoff corporation organized by the Murray broth- ers, who had no prior experience in the strip mining of coal, for the specific purpose of exploiting the Pocahontas mine.6 Operations commenced in No- vember and by the first week in December coal was moving from the mine. Meanwhile, by letter dated September 9, 1974, the Union notified Lone Star of its intention to terminate the 1971 wage agreement on November 12 and requested that the Company formally agree to be bound by the terms of any successor national agreement negotiated by the Union and the Bitumi- nous Coal Operators' Association. By letter dated September 30, Lone Star declined, but offered to meet and negotiate a new contract. No agreement was reached by November 12, and on that date Lone Star employees at the Starlight mine joined others in a nationwide strike. A national agreement was executed on December 5, 1974, but Lone Star was unwilling to be bound by its terms and its employees remained on strike as negotiations continued. On January 6, 1975, the parties entered into an interim agreement pursuant to which Lone Star employees returned to work for a 60-day period to facilitate negotiations. Bargaining continued, but the Compa- ny and the Union remained apart on several critical issues, and on March 8 the strike was resumed. Five days later, on March 11, Starlight miners appeared at the Pocahontas mine, near Dow, and began picketing with signs which read: "Lone Star on Strike for UMWA Contract." Surface employees refused to cross the picket line. One bargaining session was held several months after the strike resumed but the parties adhered steadfastly to their respective posi- tions, no agreement was reached, and the strike continued. Among other things, the Union insisted upon Lone Star's acceptance of two clauses, herein called the "successorship" clause and the "application of contract" clause, which were negotiated into the National Bituminous Coal Wage Agreement of 1974. The successorship clause, a new provision, is set forth in article I of the aforesaid agreement and reads as follows: In consideration of the Union's execution of this Agreement, each Employer promises that its 6 Enlow, who worked briefly for Surface as a mine superintendent, credibly testified that J. Paul Savage, Lone Star's director of coal properties, repeated the Company's reason for seeking an independent operator to mine the Pocahontas prospect at a conference between the Murray brothers and representatives of Lone Star, which he attended. Oliver ' Bub" Murray himself testified that he "asked them why they wanted to take inexperienced people like us and put us in the coal business or give us a contract on a coal mine" and was told "they didn't want to tackde the responsibility or the personnel, which I understand today." operations covered by this Agreement shall not be sold, conveyed, or otherwise transferred or assigned to any successor without first securing the agreement of the successor to assume the Employer's obligations under this Agreement. The application of contract clause, carried over from the preceding national agreement, is set forth in article II, section (f), of the agreement and reads as follows: As part of the consideration for this Agree- ment, the Employers agree that this Agreement covers the operation of all the coal lands, coal producing and coal preparation facilities owned or held under lease by them, or any of them, or by any subsidiary or affiliate at the date of this Agreement, or acquired during its term which may hereafter (during the term of this Agreement) be put into production or use. As set forth in the addendum to the Union's contract proposal, it is understood by all the parties that this clause becomes operative only if the Union is recognized by an employer or certified by the Board as the collective-bargaining representative of the employees involved. The Union's insistence upon Lone Star's acceptance of the above-quoted clauses and the strike, partly in support of those demands, gave rise to the instant proceeding. Based on foregoing facts, the Administrative Law Judge held that the Union did not violate Section 8(b)(4)(A) of the Act by insisting that Lone Star agree to the successorship clause, as the clause itself did not fall within the proscription of Section 8(e). Specifically, he did not view transactions of the type contemplated by the successorship clause, namely, the sale or transfer of coal properties, as covered by the "cease doing business with any other person" language of Section 8(e), thus distinguishing this case from Commerce Tankers, 7 wherein the Board found that the sale of vessels in the maritime industry was not a novel situation but a fairly common occurrence in the normal course of "doing business." Rather, the Administrative Law Judge found Cascade Employers Association8 dispositive of the issues raised herein. In Cascade the Board concluded that the sale or transfer of an entire business enterprise is generally to be viewed, not as "doing business" within the meaning of Section 8(e), but rather as the substitution of one 7 National Maritime Union of America. AFL-CIO; Commerce Tankers Corporation (Vantage Steamship Corporation), 196 NLRB 1100 (1972), enfd. 486 F.2d 907 (C.A. 2, 1973). 8 International Union of Operating Engineers, Local No. 701, AFL-CIO (Cascade Employers Association, Inc., for and behalf of its Employer Member Tru-Mix Construction Co., Inc.), 221 NLRB 751 (1975). 574 UNITED MINE WORKERS OF AMERICA entity for another while the conduct of business continues without interruption. Following issuance of the Administrative Law Judge's Decision herein, the Board had occasion in Harris Truck 9 to consider similar issues in the context of a transfer of a portion of a business enterprise. The employer in that case, who was a party to a collective-bargaining agreement which contained a provision similar to the successorship clause here in question, maintained a number of franchise dealerships for major manufacturers of trucking equipment and trailers. The Board held in that case that the selling off of two of its three facilities was not "doing business" within the meaning of Section 8(e) even though the transaction did not result in a liquidation of the employer's entire enterprise. In so holding, the Board observed that the two dealerships in question operated as separate entities, each with its own cadre of employees who were immediately offered, and accepted, jobs with the new owners. Accordingly, the Board viewed the transferred operations as separate business enterpris- es, "not only surviving and continuing after a formal change of ownership but, further, as being in the same employing industry without any apparent disruption in the normal business relationships between the new owner and Harris Truck's former suppliers and customers." The instant case is similar to Harris Truck in the foregoing respects. Lone Star operates the Starlight mine as a separate entity with a number of employees whose "tenure" at the mine extends beyond that of its owners. Further, based on past experience, it is likely that employees would continue in their jobs at the mine should Lone Star decide to sell to a successor. In these circumstances, we view the mining operations at the Starlight prospect as separate and distinct from Lone Star's other activities as a steel producer, and, given the "permanent" character of the miners' jobs at the Starlight prospect, we find that the sale or transfer of the mine by Lone Star would amount to no more than a substitution of one entity for another while the conduct of business continues without interruption, and therefore it would not be a transaction within the Act's protection. Accordingly, we agree with the Administrative Law Judge that the Respondent Union did not run afoul of the secondary provisions 9 District No. 71. International Association of Machinists and Aerospace Workers. AFL-CIO (Harris Truck and Trailer Sales Inc.). 224 NLRB 100 1976). m0 Allied Chemical & Alkali Workers of America, Local Union No. I v. Pittshurgh Plate Glass Co.. Chemical Division. 404 U.S. 157 (1971). " Id. at 179. 12 See. e.g.. Local 24, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, AFL CIO v. Oliver. 358 U.S. 283 (1959). minimum truck rental for owner-operators: Fibrehoard Paper Products Corp. v. N. L. R. B., 379 U.S. 203 (1964). contracting out unit work. of the Act by striking to compel Lone Star's acceptance of the successorship clause. Likewise, we agree that the Union did not, by engaging in such conduct, refuse to bargain in violation of Section 8(b)(3) of the Act as, in our view, the subject matter of that clause constitutes a mandatory subject of bargaining and the Union is thus entitled to insist upon its acceptance to the point of impasse. In Pittsburgh Plate Glass, 10 the Supreme Court defined a subject for mandatory bargaining as involving only those issues which settle an aspect of the relationship between the employer and his employees. Although recognizing that matters in- volving individuals outside the employment relation- ship do not normally fall within that definition, the Court recognized that they are not wholly excluded. The touchstone in such cases is "not whether the third-party concern is antagonistic to or compatible with the interests of bargaining-unit employees, but whether it vitally affects the 'terms and conditions' of their employment [emphasis supplied]." I The Court has found in certain instances that third-party concern did vitally affect the terms and conditions of employment of bargaining unit employees,12 whereas in Pittsburgh Plate Glass, supra, it did not. The instant case is distinguishable from the foregoing in that the successorship clause does not purport to deal with individuals outside the employment relationship, but rather with successor employers, who are likewise outside that relationship. Notwithstanding this dis- tinction, we are persuaded that a successor's assump- tion of any collective-bargaining agreement negotiat- ed between the Union and Lone Star would be vital to the protection of Starlight employees' previously negotiated wages and working conditions, as it is clear that the general rules governing successorship guarantee neither employees' wages nor their jobs.'3 In view of the foregoing, we agree that the Union's insistence upon including in any agreement reached a provision which would assure the survival of the fruits of collective bargaining, in the event Lone Star thereafter should dispose of the Starlight mine, is not violative of the Act, as agreement in this regard would vitally affect the terms and conditions of employment of the miners who survive such a change in ownership. 13 See. e.g., N LR. B, v. Burns International Security Service, Inc., et al., 406 U.S. 272 (1972). That case is inapposite here, however, inasmuch as it dealt with the question of whether a successor's freedom was restncted hy operation of law (i.e., whether a successor was automatically bound to the terms of a preexisting agreement). whereas the issue herein is whether voluntary restrictions upon the freedom of the predecessor (the seller) may be insisted upon by a union. We are not considering or passing upon the issues of whether a union may lawfully act to compel compliance with such a provision or whether a successor employer would be bound by the terms of such an agreement. 575 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Contrary to the Administrative Law Judge, we similarly view the "application of contract" clause as involving a subject for mandatory bargaining. The Board has recognized that certain "after acquired" clauses, which involve individuals outside the em- ployment relationship, vitally affect the interests of bargaining unit employees and therefore constitute subjects for mandatory bargaining. In Kroger, 14 the Board dealt with an employer's breach of a clause that would have had the effect of adding additional stores to a bargaining unit covered by a collective- bargaining agreement, upon presentation of evidence of a card majority among the new employees. It was found that the employer's failure to abide by that clause violated Section 8(a)(5) of the Act. It is clear that such a finding is permissible only because the clause itself was deemed to involve a mandatory subject of bargaining. For, as the Supreme Court stated in Pittsburgh Plate Glass, supra, the Act does not require continued adherence to permissive as well as mandatory terms: "The remedy for a unilateral mid-term modification to a permissive term lies in an action for breach of contract ... not in an unfair labor practice proceeding." 15 Thus, where an "after acquired" clause contemplates the accretion or absorption of employees into an existing unit, the matter constitutes a subject for mandatory bargaining. In this case, however, the application-of-contract clause does not extend the terms of a collective- bargaining agreement to newly acquired employees by adding them to the existing unit. Rather, the clause would extend that agreement in its entirety to employees of Lone Star, and its subsidiaries and subordinates, who are concededly outside that unit. This distinction, in the opinion of the Administrative Law Judge, deals a fatal blow to the Union's position. We disagree. It is clear that this clause serves to protect the jobs and work standards of bargaining unit employees at the Starlight mine by removing economic incentives which might otherwise encourage Lone Stone to transfer such work to other mines under its control. The fact that the Union could have sought other specific provisions ad- dressed solely to the protection of unit employees in a manner which would remove economic incentives to the development of other mining facilities at the expense of the Starlight miners, as the Administrative Law Judge suggests, does not render the subject matter of this clause any less vital to the employees' interests. Nor can it be said that the application of an entire collective-bargaining agreement to nonunit employees, including its noneconomic provisions, '4 Houston Division of the Kroger Co., 219 NLRB 388 (1975). ' 404 U.S. 157, 188. H* Allied Chemical & Alkali Workers of America, Local Union No. I v. Pittsburgh Plate Glass Co., Chemical Division, 404 U.S. 157, 178-179 ( 1971). necessarily reveals a disguised purpose to promote the Union's institutional or organizational interests. Indeed, as previously mentioned, the "application of contract" clause herein is understood to become operative only if the Union is recognized by an employer or certified by the Board as the collective- bargaining representative of the employees to be covered thereby. In view of the foregoing, we find that the application-of-contract clause here in ques- tion deals with a mandatory subject of bargaining and, accordingly, that the Respondent Union did not violate Section 8(b)(3) of the Act by striking in support of its demand that Lone Star agree to its inclusion in any collective-bargaining agreement reached. We shall, therefore, dismiss the complaint in its entirety. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board hereby orders that the complaint herein be, and it hereby is, dismissed in its entirety. MEMBER WALTHER, dissenting in part: I disagree with the majority's conclusion that the "successorship" and "application of contract" claus- es constitute mandatory subjects of bargaining. Accordingly, I conclude that the Union refused to bargain in violation of Section 8(b)(3) of the Act by striking to compel Lone Star's acceptance of these clauses. The Supreme Court has defined mandatory sub- jects of bargaining as those matters which settle some aspect of the relationship between the employer and his employees, or those matters which-although they concern individuals outside the employment relationship-nevertheless vitally affect the terms and conditions of employment of bargaining unit employees.6 The majority states that the successor- ship clause passes the latter, or "vitally affects" test, for mandatory subjects of bargaining. In so conclud- ing, the majority fails to consider that application of the vitally affects test to third-party concerns, such as the successorship clause, does not turn "only on the impact of the third-party matter on employee interests. Other considerations, such as the effect on the employer's freedom to conduct his business, may be equally important [citation omitted]."17 In this regard, it should be noted that a successorship clause will have a substantial effect on an employer's freedom to conduct its business and to dispose of its capital assets. The Supreme Court has described this effect as follows: 17 Id., fn. 19 at 179. 576 UNITED MINE WORKERS OF AMERICA A potential employer may be willing to take over a moribund business only if he can make changes in corporate structure, composition of the labor force, work location, task assignment, and nature of supervision. Saddling such an employer with the terms and conditions of employment con- tained in the old collective-bargaining contract may make these changes impossible and may discourage and inhibit the transfer of capital.18 The Court was unwilling in Burns to impose such restraints on the free transfer of capital and went on to hold that a successor employer is not bound by the substantive provisions of the collective-bargaining agreement negotiated by the predecessor employer). Under Burns, a successor of Lone Star will not be bound to observe the substantive provisions of any collective-bargaining agreement negotiated by Lone Star. However, by virtue of the successorship clause, if agreed to by Lone Star and thereafter complied with, a successor of Lone Star will be obligated to recognize and bargain with the Union and to assume, in toro, the burdens of the agreement. Thus, the successorship clause will achieve precisely what the Burns court sought to avoid-saddling a potential purchaser with Lone Star's collective-bargaining agreement-thereby inhibiting Lone Star's freedom to dispose of its capital assets. That the successorship clause achieves this result through a negotiated agreement rather than through the compulsion of a Board order, as was the case in Burns, does not make Burns inapposite here. The restraint on the free transfer of capital assets is as real when imposed by private agreement as it is when imposed by a Board order. By denoting the successorship clause a mandatory subject of bargaining, the majority allows the Union to sidestep the Burns decision. The Union will be free to engage in economic warfare to compel Lone Star to agree to include the successorship clause in a collective-bargaining agreement. With the clause included in an agreement, Lone Star's freedom to dispose of its assets will be severely curtailed, accomplishing precisely what the Burns Court sought to avoid. For this reason, I cannot join the majority. In addition, I do not believe that the successorship clause "vitally affects" the terms and conditions of employment of bargaining unit employees within the meaning of Pittsburgh Plate Glass, supra, and therefore is not a mandatory subject of bargaining. The majority states that "the Union's insistence upon including in any agreement reached a provision i' N L.R.B v. Burns International Securit, Services. Inc., 406 U.S. 272, 287-288 (1972). i. A successor employer, however, is obligated to recognize and bargain with an incumbent union in situations where it retains a majority of the predecessor's employees and the relevant bargaining unit remains un- changed. Id at 281. which would assure the survival of the fruits of collective bargaining, in the event Lone Star thereaf- ter should dispose of the Starlight mine, is not violative of the Act, as agreement in this regard would vitally affect the terms and conditions of employment of the miners who survive such a change in ownership." There is no requirement either in the collective-bargaining agreement or in the Act which would require a party which subsequently acquires the Starlight mine to employ former Starlight employees. It is therefore possible that the successor- ship clause, if and when it is applied, would benefit or restrict stranger employees rather than bargaining unit employees. Under such circumstances, it can hardly be said the successorship clause vitally affects the terms and conditions of employment of bargain- ing unit employees. I also find it significant that the successorship clause requires a successor to assume the collective- bargaining agreement in toro, including noneconomic provisions which even my colleagues would have to concede do not vitally affect the terms and condi- tions of employment of bargaining unit employees. The proposed agreement, for example, contains noneconomic provisions for union recognition, union access to the mine, checkoff of union dues, use of bulletin boards by the Union, and the use of company bathhouses for meetings. While these provisions may vitally affect the Union as an institution and enhance its position as collective- bargaining representative, they do not vitally affect the terms and conditions of employment of bargain- ing unit employees. Accordingly, to the extent the successorship clause seeks to continue in effect the above-described provisions, the clause is not a mandatory subject of bargaining, and the Union therefore failed to bargain in violation of Section 8(b)(3) by striking to compel Lone Star's acceptance of the clause.20 Turning to the application-of-contract clause, I am able to agree with two aspects of my colleagues' discussion of this clause. They correctly note that (I) the Board has indicated that an "after acquired" clause is a mandatory subject of bargaining when the clause contemplates the accretion of employees-to be covered by the collective-bargaining agreement- into the existing unit,21 and (2) the application-of- contract clause here does not contemplate such an accretion. I must, however, part ways with my colleagues when they conclude that this distinction does not deal a fatal blow to the contention that the 20 See N. L R. B. v. Wooster Division of Borg-Warner Corp., 356 U.S. 342, 349 (1958). 21 Houston Division of the Kroger Co.. 219 NLRB 388 (1975). 577 DECISIONS OF NATIONAL LABOR RELATIONS BOARD application-of-contract clause vitally affects the terms and conditions of employment of bargaining unit employees. Since the clause will apply the proposed agreement to nonunit employees, I do not believe it is a mandatory subject of bargaining. As the Administrative Law Judge below succinctly stated: I simply do not see how applying this contract to another facility of the company, should it be created and should the Union be successful in gaining recognition rights, would have any bearing on the wages, hours and other terms and conditions of unit employees. My colleagues vainly attempt to save the clause as a mandatory subject of bargaining by finding that the "clause serves to protect the jobs and work standards of bargaining unit employees at the Starlight mine by removing economic incentives which might otherwise encourage Lone Star to transfer such work to other mines under its control." The clause, however, is not restricted to after-acquired facilities competing with the Starlight mine. Rather, it would take effect and apply the proposed collective-bargaining agreement to an after-acquired, noncompeting facility involved with some aspect of coal production other than mining. I do not understand how applying the contract to nonunit employees at an unrelated facility will protect the jobs and work standards of bargaining unit employees at the Starlight mine. It is also significant that the clause does not utilize other, more precise, means to remove any economic incentive which otherwise might encourage Lone Star to transfer work to an after-acquired facility competing with the Starlight mine. As suggested by the Administrative Law Judge below, the clause could have provided that should Lone Star engage in a competitive operation it would not pay substan- dard wages or fringe benefits to such employees. This suggested provision would accomplish the precise object which the majority states is crucial in making the application-of-contract clause a mandatory subject of bargaining, as it would require that the labor costs at a competing operation match those at the Starlight mine. Such a precise and narrowly drawn clause, moreover, would be analogous to similarly precise and narrow third-party concern clauses which have been held to be mandatory subjects of bargaining. Illustrative is the clause in Local 24, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, AFL-CIO v. Oliver,22 which provided a minimal rental to be paid owner-operators. The Supreme 22 358 U.S. 283 (1959). 23 Id at 293-294. Court held this clause was a mandatory subject of bargaining as its object was "to protect the negotiat- ed wage scale against the possible undermining through diminution of the owner's wages for driving which might result from a rental which did not cover his operating costs."2 3 As the application-of-contract clause here is neither precisely nor narrowly drawn to remove the economic incentives which otherwise might encourage Lone Star to transfer work to another mine under its control, I conclude that the clause does not vitally affect the terms and condi- tions of employment of bargaining unit employees within the meaning of Oliver. It should also be noted that the application-of- contract clause, like the successorship clause, puts into effect the proposed collective-bargaining agree- ment, in toto, including the noneconomic provisions for union recognition, union access to the mine, union dues checkoff, union use of bulletin boards, and union use of bathhouses for meetings. It is clear that these provisions have no bearing on bargaining unit employees' terms and conditions of employ- ment. To the extent the application-of-contract clause seeks to apply these provisions to after- acquired facilities, the clause is a nonmandatory subject of bargaining, and the Union therefore failed to bargain in violation of Section 8(bX3) by striking to compel Lone Star's acceptance of the clause.24 Lastly, I believe the application-of-contract clause is not a mandatory subject of bargaining because it places an impermissible restraint on Lone Star's freedom to dispose of its assets. As discussed above in connection with the successorship clause, the Supreme Court in Burns has expressed a policy favoring the right of employers to dispose of capital assets free of the restraints which would arise if a successor employer were bound by the provisions of the collective-bargaining agreement negotiated by the predecessor employer. The application-of-con- tract clause implicates the same policy considerations underlying Burns. Assuming the application-of-con- tract clause is contained in a collective-bargaining agreement negotiated by Lone Star, its decision thereafter whether or not to acquire a new facility would occur under the shadow of that clause. In the absence of that shadow Lone Star might be willing to acquire a new facility as it would be able to make "changes in corporate structure, composition of the labor force, work location, task assignment and nature of supervision." 25 But the clause has the effect of "[sladdling [Lone Star] with the terms and conditions of employment contained in the old collective bargaining contract [which] may make 24 Borg. Warner Corp., supra. 356 U.S. at 349. 25 Burns, supra, 406 U.S. at 287-288. 578 UNITED MINE WORKERS OF AMERICA these changes impossible and may discourage and inhibit the transfer of capital." 26 Accordingly, as was the case with the successorship clause, I conclude that, by denoting the application-of-contract clause a mandatory subject of bargaining, the majority allows the Union to thwart the policy of the Burns decision. As a result of the majority's decision, the Union will be free to engage in economic warfare to compel Lone Star to agree to include the clause in a collective-bargaining agreement. If the clause is so included, Lone Star's freedom to dispose of its capital assets will be impermissibly limited under Burns. For the foregoing reasons, I would find that Respondent's conduct with respect to both the successorship and application-of-contract clauses violated Section 8(b)(3). 26 Id at 288. DECISION STATEMENT OF THE CASE JAMES L. ROSE, Administrative Law Judge: These matters came on for hearing at McAlester, Oklahoma, from October 21 through October 24, 1975, upon the Regional Director's complaints alleging, in general terms, that the United Mine Workers of America committed unfair labor practices by: (1) bargaining to impasse over a nonmandatory subject of bargaining (the application of contract to coal lands) and over an unlawful successorship clause in violation of Section 8(b)(3); (2) engaging in unlawful inducement and encouragement to achieve a clause unlawful under Section 8(e) (the successorship clause) in violation of Section 8(bX4)(A); and (3) engaging in secondary boycott picketing in violation of Section 8(b)(4)(i) and (ii)(B). Subsequent to the hearing, all counsel submitted briefs which have been duly considered and upon the record as a whole, including my observation of the witnesses, argu- ments and briefs of counsel, I make the following findings and conclusions: I. JURISDICTION Lone Star Steel Company is Texas based and manufac- tures steel products, principally pipe for use in the oil and gas industry. In connection with its business, it uses 36,000 to 40,000 tons of coal per month to make coke, which in turn is used in the steelmaking process. During the past year Lone Star purchased and received materials from outside the State of Oklahoma valued in excess of $50,000 and shipped to points outside the State of Oklahoma material valued in excess of $50,000. It is admitted, and I find, that Lone Star is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. II. THE LABOR ORGANIZATION INVOLVED United Mine Workers of America represents employees in industries affecting interstate commerce, including the employees of Lone Star Steel Company. It is admitted, and I find, that the United Mine Workers of America is a labor organization within the meaning of Section 2(5) of the Act. III. THE ALLEGED UNFAIR LABOR PRACTICES A. Factual Background The parties are in general agreement concerning the factual situation. Briefly, for many years Lone Star has purchased coal from various sources, including coal mines in Oklahoma. Also Lone Star owns the mineral rights to coal fields, some of which are kept in reserve while others are mined for current needs. Lone Star owns the rights to coal at a mine which is variously described by the witnesses as the Star Light or McCurtain (a nearby town in southeastern Oklahoma) mine. Prior to April 1973, this coal was being mined by the River Corporation. At that time, for reasons not material nor detailed in the record, Lone Star determined to mine the coal with its own employees and began to do so. In connection with this, Lone Star took over and became a party to the National Bituminous Coal Agreement between the United Mine Workers of America and River Corporation. Although some terms were changed by addendum, basically the agreement was followed by Lone Star and the Respondent Union. By its terms, the agreement would terminate on Novem- ber 12, 1974. On September 7, 1974, the Respondent gave notice to all independent signatories to the agreement, of which Lone Star was one, that it wished to terminate the agreement and negotiate a new one. During the period when the Respondent was negotiating with the Bituminous Coal Operators' Association, representatives of the Re- spondent also met with the vice president and general counsel of Lone Star. Apparently Lone Star sought more favorable terms than were ultimately agreed to by the Operators' Association. In any event, along with other members of the Respon- dent nationwide, on November 12, 1974, employees of Lone Star engaged in an economic strike in order to force their bargaining position. Contract talks continued as did sessions between representatives of Lone Star and repre- sentatives of the Union. The Operator's Association and the Union came to an agreement; however, Lone Star did not, and its employees continued to strike. In late December 1974, Lone Star suggested that the employees should return to work for a period of 90 days so that negotiations could continue in a less adversary context. Union representatives agreed to recommend to its National Executive Board, as well as to the local union membership, a return to work for 60 days. The National Executive Board and the local union membership con- curred and on about January 6, 1975, the employees did in fact return to work. There followed negotiation sessions, but the parties remained apart on some terms. Thus, no agreement was reached by March 6, and the Company asked that the 579 DECISIONS OF NATIONAL LABOR RELATIONS BOARD employees refrain from striking for another 7 days. The union representatives apparently agreed to this; however, this time a majority of the employees would not continue to work without a contract. On or about March 6, 1975, employees at Lone Star again went on strike which continues to date. Paralleling these events, sometime in the summer of 1974, Lone Star made a decision to commence mining its coal reserves at a mine approximately 50 miles from the Starlight mine, variously referred to as the Dow (the name of a nearby town) or Pocahontas mine. Representatives of Lone Star testified that inasmuch as they really are not in the coal mining business they determined to have this mine operated by a subcontractor who would be paid on a per- ton basis. Tentative contracts were apparently made with several individuals or companies, and finally an agreement was entered into between Lone Star and an organization called Surface, Incorporated, a corporation organized for the specific purpose of engaging in mining activity at the Dow mine. This company is a spinoff corporation of the basic Murray brothers partnership, three brothers who engage in various type of construction work and do business through several different entities. Inasmuch as the Murray brothers were not familiar with strip coal mining, representatives of Lone Star were always present at the Dow mine to watch over the operation, although Surface had its own people as the supervisors and managers. Sometime in the first part of November 1974, Surface began hiring employees and mining the coal and did so until on or about March I 11, 1975, when a majority of its employees ceased working. In the latter part of January 1975, the Respondent began an organizational campaign among Surface's employees. There is testimony that some 33 authorization cards were signed among the 36 employees. A representation petition was filed in February but has not been acted on, unfair labor practice charges filed by the Union having blocked further processing. On March 11, 1975, pickets from the employees of Lone Star appeared at the Dow mine. On that day the Dow employees ceased working. Prior to March 11, Surface had engaged in certain activity which led the Union to file unfair labor practice charges which in fact are the subject of the complaint in Case 16-CA-6006, currently pending before an Adminis- trative Law Judge.' The Union argues, therefore, that the strike by Surface employees was both to protest the Company's unfair labor practices and to seek recognition. An injunction against further picketing by the United Mine Workers at the Dow mine was entered by the United States District Court for the District of Oklahoma on March 18, 1975. There has been no subsequent picketing although employees of both Lone Star and Surface continued to strike. The employees of Lone Star are and have been members of the Respondent Union. The employees of Surface are not members but have filed authorization cards to have the Union represent them. Presumably, they will become I Administrative Law Judge Anne F. Schlezinger issued her decision, J D--76, on January 15, 19761224 NLRB 155]. members if and when the Union gains recognition and finally executes a contract with Surface. The parties stipulated that prior to March 11, 1975, the employees of Surface had a right to strike for recognition and had reasonable cause to believe that sufficient unfair labor practices had been committed by Surface to justify their striking in protest. Nevertheless, Surface charges, and the General Counsel alleges, that when Lone Star employees picketed the Dow mine, the Union thereby violated Section 8(b)(4) of the Act. The Union argues that either Surface was an ally of Lone Star and/or Surface employees had a right to strike. Thus the picketing by Lone Star employees was not an inducement to cease work, rather their own problem with Surface led them to strike. B. Issues The General Counsel's complaint, the Respondent's answer, and this factual situation thus present the following questions: 1. Whether the Union struck over a contract clause proscribed by Section 8(e) - the successorship clause - in violation of Section 8(a)(4)(A) and 8(b)(3). 2. Whether the Union struck over a contract clause involving a nonmandatory subject of bargaining - the application of contract to coal lands - in violation of Section 8(b)(3). 3. Whether picketing at the Dow mine, on and after March 11, 1975, was violative of Section 8(b)(4)(i) and/or (ii)(B). C. Discussion The essence of the 8(b)(3) refusal-to-bargain allegation is that the Union bargained to impasse over one clause which the General Counsel claims is illegal and another which is not a mandatory subject of bargaining. For convenience, these respectively will be referred to as the successorship clause and the application-of-contract clause. The successorship clause is found in article I and reads as follows: In consideration of the Union's execution of this Agreement, each Employer promises that its operations covered by this Agreement shall not be sold, conveyed, or otherwise transferred or assigned to any successor without first securing the agreement of the successor to assume the Employer's obligations under this Agree- ment. The application-of-contract clause is found in article II, section (f) of the contract and reads as follows: Application of This Contract to the Employer's Coal Lands As part of the consideration for this Agreement, the Employers agree that this Agreement covers the operation of all the coal lands, coal producing and coal preparation facilities owned or held under lease by 580 UNITED MINE WORKERS OF AMERICA them, or any of them, or by any subsidiary or affiliate at the date of this Agreement or acquired during its term which may hereafter (during the term of this Agreement) be put into production or use. These clauses were proposed by the Union and were ultimately negotiated into the National Bituminous Coal Wage Agreement of 1974. There is thus no question that the Union asked for and obtained a contract containing the terms in question - at least as to most employers. There is also no question that Lone Star, acting through its vice president and general counsel, rejected these clauses during negotiations. The Union recognizes that, as written, the application-of- contract clause could lead to an unlawful implementation. Thus, amended language is to the effect that the contract could not apply to a new operation of Lone Star unless and until the Union gained representation rights among the employees either through authorization cards and/or a representation election. Lone Star's vice president and general counsel, Howard Jensen, testified concerning the bargaining sessions and the Company's position with regard to these clauses. For instance, in a December meeting with union representa- tives, Jensen stated: "I had very serious reservations about the new successorship clause . . . and I had reservations about the accretion clause." In a subsequent meeting Jensen again told the union representative that Lone Star was not agreeing to the successorship or the application-of-contract clauses be- cause they were illegal or in any event were not mandatory subjects of bargaining. Finally Jensen stated in letters to the Union that the parties were in basic disagreement over four items, including the successorship and application-of-contract clauses. Richard M. Bank, executive assistant to the Respon- dent's International president and the principal union representative negotiating with Jensen, testified that the Union took the position throughout that the clauses were important and legal. In any event, Bank stated that Lone Star did not offer substitute language for either and that the Union was willing to consider any reasonable compro- mise on these issues. Indeed, the record supports Bank's testimony that the Union did make some changes in language to conform to proposals by Lone Star - particularly including the matter of the cost-of-living escalator and the termination clause. A reasonable evaluation of the total record is that the Union proposed two clauses by which it sought to protect its membership and its work jurisdiction and which could be used in organizing. For what appears to be legitimate business reasons, the Company rejected the Union's proposed language. These two items, among other things, were matters of disagreement when the strike recommenced. The strike, in part at least, was to achieve a contract containing these subjects. It is alleged the Union bargained to "impasse" over these clauses and by striking to achieve them violated Section 8(b)(3). The Successorship Clause In International Union of Operating Engineers, Local No. 701 (Tru-Mix Construction Co.), 221 NLRB 751 (1975), decided after the hearing in this matter, the Board held that a clause of substantially the same import as the successor- ship clause here is not proscribed by Section 8(e). A majority of the panel concluded that in spite of a transfer of all, or substantially all, of a company's assets, the business enterprise nevertheless survives and is the same employing industry. Therefore, the transferring of assets is not "doing business" within the meaning of Section 8(e) of the Act. That is, in the event of a sale of assets or change of ownership, the company would continue to engage in its normal business with its customers and these relationships would not necessarily be affected. It is what the company does in industry which constitutes "doing business," or the lack of it, within the meaning of Section 8(e). The Board, in its Tru-Mix decision, distinguished National Maritime Union, AFL-CIO (Commerce Tankers Corporation), 196 NLRB 1100 (1972), enfd. 486 F.2d 907 (C.A. 2, 1973), cert. denied 416 U.S. 970 (1974). There it was concluded that in the maritime industry the buying and selling of ships is a common matter and is an aspect of the normal business dealings engaged in by ship compa- nies. Therefore, the buying or selling of a vessel is "doing business" within the meaning of Section 8(e) and contrac- tual restrictions upon these dealings are violative of Section 8(e). Lone Star argues that it is a fully integrated steel company whose business includes buying and selling of coal properties. Thus, its situation is analogous to buying and selling ships as an aspect of its "doing business." Lone Star does buy coal and properties in order to supply its coke ovens. But its business is making steel, not selling coal lands. In addition, should Lone Star sell the Starlight mine, the mine would continue as the employing entity, even though the ownership changed. The "doing business" in this case is mining coal and related endeavors - not selling coal properties. Under the test in Tru-Mix, the successorship clause is not proscribed by Section 8(e). And it is a mandatory subject of bargaining. To insure that a successor to Lone Star would continue in force and effect all the wages, hours, and other terms and conditions of employment obviously relate to those matters as to bargaining unit employees. That a successor would pay the negotiated wage rate, for instance, is surely as important to the employees as Lone Star paying the rate. Having concluded that the successorship clause is not proscribed by Section 8(e), it follows that striking and picketing to achieve such a clause is not violative of Section 8(b)(4XA). And to strike to achieve it is not a refusal to bargain under Section 8(bX3) since it is a mandatory subject of bargaining. The Application-of-Contract to Coal Lands Clause as a Subject of Bargaining The parties sometimes refer to this clause as an accretion clause. It does not, however, by its language purport to accrete into an already existing bargaining unit new employees of a new operation. 581 DECISIONS OF NATIONAL LABOR RELATIONS BOARD As noted above, such impurities in the clause as may exist in the National Agreement may have been cured by the Union's most recent proposed language as to when and under what conditions the Company would be required to apply the contract to a new operation. The General Counsel has not alleged this clause to be violative of the Act on its face, but only that it concerns a nonmandatory subject of bargaining. The thrust of the General Counsel's argument is that, by applying the entire contract to new operations, the Union seeks more than simply attempting to preserve bargaining unit standards. It seeks also items of institutional interest particularly including, apparently, a facility to organize new employees. In support of his position, the General Counsel cites Oil, Chemical & Atomic Workers International Union [Shell Oil] v. N.L.R.B., 486 F.2d 1266 (C.A.D.C., 1973), and Local 445, International Union of Electrical, Radio and Machine Workers, AFL-CIO (Sperry Rand), 202 NLRB 183(1973). The Respondent, on the other hand, argues that a contract clause which seeks to affect terms and conditions of employment of persons outside the bargaining unit is mandatory where such "vitally" affect unit employees, citing Local 24, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, AFL- CIO v. Oliver, 358 U.S. 283 (1958); and Allied Chemical & Alkali Workers of America, Local Union No. I v. Pittsburgh Plate Glass Co., Chemical Division, 404 U.S. 157 (1971). In all the cases relied on by the General Counsel and the Respondent, certain provisions of a contract were extended to employees outside the bargaining unit. This, however, is not that type of situation. Here no contract terms will apply to nonunit employees. Rather, should the Company create a situation in which another bargaining unit materializes and thereafter should the Union succeed in getting representation rights for those employees, then the contract would automatically be accepted by the employer - whether that employer be Lone Star or an affiliate to Lone Star. Such may have some elements of protecting unit work or negotiated standards of unit employees. The clause, however, goes beyond these matters and becomes, among other things, an organizing tool. Unit standards could be protected simply by a clause requiring Lone Star, should it open a new mine, to pay employees no less than the wages set forth in the contract. It could do so without the contract automatically and in every respect applying to the new operation as the proposed clause does. Further, the clause could operate in areas not necessarily competitive with the work unit employees are doing, e. g., coal preparation facilities as opposed to mining; and to that extent it goes beyond protecting unit work and standards. A fair interpretation of this clause, along with Bank's testimony, is that a principal purpose for the application of contract to coal lands is to facilitate organizing. If it were simply to protect unit standards, then it could be written as the clause in Oliver, but such would not necessarily be as effective in organizing employees. Additionally, this clause can only protect the unit stan- dards in the event that the Union is successful in organizing the employees of the new facility. If it is not successful, then the Company can apply such wages and conditions as it wishes, conceivably to the detriment of negotiated standards. By this clause, the Union is seeking an agreement in advance that should the Employer open a new and distinct facility involving coal preparation or production and not just a coal mine, and should the Union be successful in obtaining recognition rights for the employees of that new facility, then the Company will have to accept the already agreed-upon contract. The question is whether this is a mandatory subject of bargaining. Is it reasonable to say that the subject sought to be negotiated by the Union was the protection of unit standards or was it broader, including matters of institu- tional interest such as organizing nonunit employees? If it is simply the former, then it is mandatory. If it is of the latter, then there is some question as to whether or not it is mandatory. It does not appear that the Board or courts have decided this precise issue; however, the matter of after-acquired property clauses has been considered, most recently in Houston Division of the Kroger Co., 219 NLRB 388 (1975), and Smith's Management Corporation, d/b/a Mark-it- Foods, 219 NLRB 402 (1975). A divided Board decided these matters accepting the court's remand in Retail Clerks International Association Local No. 455, AFL-CIO v. N.L.R.B., 510 F.2d 802 (C.A.D.C., 1975). The factual situation in each is substantially the same. There was an existing multistore bargaining unit in the retail store industry. The recognition clause to which the parties had agreed, and implemented for a number of years, provided that new stores be accretions to the multistore unit. And the contract would apply to the new stores. At issue was whether the "additional store clauses" were valid in situations where the union demonstrated majority status by authorization cards or whether, in spite of the existence of such clauses, the employer nevertheless can insist on a Board conducted election. It was finally concluded by a Board majority that such clauses are valid and constitute a waiver of the employer's right to demand an election, and that "national labor policy favors enforcing their validity." The Board ordered that upon request the company was to apply and extend to employees at the new stores "as part of the appropriate unit" the existing collective-bargaining agreement and give the agreement retroactive effect. In Young and Hay Transportation Company, 214 NLRB 252 (1974), the Board found valid an after-acquired clause at the same time holding that neither the clause nor the Board's certification at the new facility meant that the new facility merged into the preexisting bargaining unit. Therefore, the company did not refuse to bargain by refusing the union's demand that bargaining be conducted on the basis of a multifacility unit. An unambiguous after-acquired clause will be given effect whether it contemplates the new facility being merged into a preexisting bargaining unit or not. Thus Board law permits a company and a union to negotiate for 582 UNITED MINE WORKERS OF AMERICA future employees in a future bargaining unit as the Respondent here demands. However, whether an after-acquired clause is a mandato- ry subject of bargaining is another matter - and one not an issue in any of these cases. In the Kroger line of cases, the clause related to the scope of the bargaining unit and was presumably mandatory. The starting point for collec- tive bargaining is the bargaining unit; and whether new employees will or will not be absorbed into the bargaining unit reasonably relates to employment conditions of unit employees, especially with regard to future negotiations. Given the Board's approach in these cases, and the nature of the order - that the employer accept the contract, including the "after acquired store" clause, as to the new store, it seems implicit that such a clause is in the realm of mandatory subjects. However, the clause in Young and Hay and the one here do not relate to the existing bargaining unit. The application-of-contract clause does not purport to "accrete" into the existing bargaining unit employees of a new facility. Indeed, not knowing the nature of the operation which the Employer might start up and to which this contract would then be applicable, it is not possible to tell whether a multifacility bargaining unit would even be appropriate should such be petitioned for. Certainly, the Employer could begin to process coal at another facility in such a manner that the employees doing the work would not appropriately be part of the bargaining unit here. The application-of-contract to coal lands clause, as modified by the Union, sufficiently protects the Section 7 rights of the prospective new employees. It is not alleged to be unlawful, and I conclude it is not. It is a clause which the parties could agree to and would be given effect by the Board. But I do not believe that it is a mandatory subject of bargaining. In order to be a mandatory subject of bargaining the subject must relate to wages, hours, or other terms and conditions of employment in the bargaining unit. N.L.R.B. v. Wooster Division of Borg-Warner Corporation, 356 U.S. 342 (1958). To set wages for nonunit employees may very well affect the wages of unit employees and therefore be mandatory. Local 24, Teamsters v. Oliver, 358 U.S. 283 (1958). However, to agree in advance concerning the terms and conditions of employment of nonexistent employees in a new and nonrelated facility does not particularly relate to wages, hours, or the terms and conditions of employment of unit employees. I simply do not see how applying this contract to another facility of the Company, should it be created and should the Union be successful in gaining recognition rights, would have any bearing on the wages, hours, and other terms and conditions of unit employees. Nor would implementation of this clause reasonably affect unit jobs, except in the situation where the Company would open another mine. This clause, by its terms, goes to all phases of coal production and not just mining. Finally, I do not believe that the principal purpose of this clause is to protect unit standards. That could be done in other ways, for instance, by providing that the Employer would not engage in a competitive operation and pay employees less or grant them less favorable working conditions. I conclude that the principal purpose for the application- of-contract clause is as an organizing device. As such, while not illegal and certainly from the union standpoint desirable, nevertheless it does not relate to wages, hours, and other terms and conditions of employment of unit employees. This clause cannot be considered a mandatory subject of bargaining. To negotiate a contract covering nonexistent employees in a nonexistent bargaining unit may be permissible, but it is not required. The record is clear that the Union is engaging in a strike to achieve its bargaining proposals, including the applica- tion-of-contract to coal lands clause and to that extent it is striking over a nonmandatory subject of bargaining. It is argued that the Union bargained to impasse over the application clause and therefore violated Section 8(bX3). Impasse is a plastic concept and not really material here. Whether the parties reached an impasse, and if so when, need not be decided. The Union can strike to force its bargaining position, whether or not there has been an impasse. It cannot, however, strike to force the Company to accept a nonmandatory subject of bargaining even if there was no impasse. To the extent it is striking to achieve agreement on a nonmandatory subject, it is refusing to bargain within the meaning of Section 8(b)(3), e. g., Local 445, Intl. Union of Electrical Radio and Machine Workers, AFL-CIO (Sperry Rand), 202 NLRB 183 (1973). Striking and Picketing at the Starlight Mine On November 12, 1974, employees of Lone Star, along with other members of United Mine Workers, commenced an economic strike in furtherance of their contract demands. The strike was settled nationally when the contract was executed. Thereafter, Lone Star employees continued to strike until it was determined by agreement of the parties that they would return to work for 60 days in an effort to work out a settlement to the contract. This they did on January 6, 1975. They continued to work until March 6, 1975, at which time they again struck. In connection with the strike, Lone Star employees have picketed the Starlight mine. This strike is alleged by the General Counsel to be violative of the Act only insofar as it is in furtherance of the Union's demand concerning a permissive subject of bargaining and/or for an unlawful contract clause. The General Counsel does not allege that the strike and picketing activity at the Lone Star facility is in any other respect violative of the Act. Inasmuch as I have concluded that the successorship clause is not violative of Section 8(e), the strike and picketing of Lone Star would not be violative of Section 8(bX4XA). The strike does, however, violate Section 8(bX3) to the extent that one factor concerns the Union's demand for a nonmandatory subject of bargaining. The Strike and Picketing Activity by Lone Star Employees at the Dow Mine A few days after they recommenced striking, the Lone Star employees put up picket signs and walked with picket signs in the vicinity of the gate to the Dow mine. 583 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Thereafter, and reasonably as a result of this picketing, Surface employees of the Dow mine ceased working and they continue to strike to the present time. The Respondent argues that Surface employees had a right to strike, namely, to protest unfair labor practices and/or for recognition. However, it is more probable that these employees left work when they did, on March 11, 1975, because of the picketing by Lone Star employees. Conversely, had the Surface employees been motivated only by their desire to protest unfair labor practices or to seek recognition, it follows they would have begun striking prior to March 11, if not on February 25 or shortly thereafter. The point is, if the Surface employees had reason to believe they could and should engage in an unfair labor practice strike and/or to seek recognition, they reasonably would have begun striking earlier. Not having done so, the conclusion is inescapable that they would not have gone out on March II but for the picketing. The Surface employees may very well have had legiti- mate reasons to engage in a work stoppage, and they may very well at this time be entitled to such benefits as accrue to unfair labor practice strikers. Nevertheless, it must be found that a precipitating cause of their ceasing work on March 11, 1975, was the picket activity engaged in by Lone Star employees. The question is whether the picketing was secondary and violated the Act. Although Lone Star had employees, actually representa- tives of management, at the Dow facilities at all times to superintend the excavation of the coal, and although Lone Star owned the right to the coal being excavated, nevertheless, it is concluded that the Dow mine was not sufficiently a primary situs of Lone Star's work so as to render the picketing primary from that standpoint. However, it is concluded that Surface is sufficiently allied with Lone Star so as not to be considered a neutral with regard to Lone Star's labor dispute with its employees. From the totality of the evidence it is concluded that the principal reason Lone Star determined to have the coal at the Dow mine excavated by employees of a subcontractor, rather than hiring its own, was the prospect of a 1974 strike. The timing is significant. While Lone Star keeps much of its coal in reserve, it was only in the late summer of 1974 that it determined to start mining the Dow mine. Further, it reasonably appears from the testimony and the evidence that a reason Lone Star started to mine the Dow coal was to have an alternative source of supply should the Starlight facility be shut down. There was much testimony that the Dow coal is not identical to, and would not be a substitute for, the Starlight coal. Nevertheless, from all of the chemical properties it does appear that the Dow coal, when mixed with coal from other sources, could reasonably be a replacement for the Starlight coal and indeed has been. Thus, without Starlight coal but with Dow coal mixed with other coal, Lone Star was able to make coke. I credit the testimony of Johnnie Enlow to the effect that Lone Star sought an independent subcontractor to mine the coal so that it would have an alternative source of supply in case of a strike. And I discredit testimony indicating otherwise - specifically the testimony of J. Paul Sanvage. It is more probable that the possible strike was the reason Lone Star chose to operate through a subcon- tractor rather than the reasons given by Lone Star witnesses. Specifically, it is noted that, now and since 1973, Lone Star has operated the Starlight mine which is located only 50 some miles from the Dow mine. For Lone Star management to say that they are not primarily in the business of mining coal is just simply not the case. Lone Star is experienced in coal mining yet, it contracted the Dow work to an experienced operator. This has to have been less efficient, if for no other reason than Lone Star management had to keep in fairly close supervision. I conclude that the arrangement originated by Lone Star to have its reserves mined by an independent contractor created an ally situation, even though Dow coal has somewhat different properties from the Starlight coal. Dow is Lone Star's mine. And the coal goes into Lone Star's coke ovens. From the totality of the evidence, including the fact that Lone Star owned the coal, used the coal, had management superintending the excavation by an inexperi- enced operator, set up the operation in late October 1974, just weeks before the national strike, it is concluded that Surface is not a neutral employer in the sense of Section 8(bX4). Rather, Surface is an ally and for Lone Star employees to picket the premises where Surface was operating was not for an object proscribed in subsection (B) of 8(bX4). Hence the picketing was not violative of Section 8(bX4)(i) or (iiXB). Graphic Arts International Union (G.A.I.U.), Local Number 277; and Graphic Arts International Union, AFL-CIO (S & M Rotogravure Service, Inc.), 219 NLRB 1053 (1975). Finding Surface to be a legal "ally" does not imply that the Murray brothers were privy to Lone Star's planning or even knew what they were getting into. I believe from their testimony that the Murrays, who are in the construction business in various ways, were not aware of the potential hazards involved. Nevertheless, for purposes of Section 8(bX4), Surface is an "ally." I note also that Lone Star is paying expenses, including legal fees, incurred by Surface with regard to these matters, further indicating that, as to this labor dispute and the work involved, the parties consider themselves allied. Two further matters should be mentioned. First, on the day that the Starlight employees began picketing the Dow mine, Surface attempted to set up a separate gate for Lone Star employees. The testimony, however, is to the effect that, while this may have been the aim, no separate gate ever effectively functioned. Indeed, the bulldozer operator who was sent out to set up the separate gate testified that the road which Surface sought to have used by Lone Star employees was impassable inasmuch as there was a ditch across it. The road could not have been used without filling in the ditch. The other matter concerns Dow employees' right to strike without regard to Lone Star picketing. No doubt Dow employees did and do have the right to strike for recognition and to protest alleged unfair labor practices. This right, however, has no materiality to the question of whether or not picketing by Lone Star employees is proscribed by the Act. The activity engaged in by Lone Star employees must stand on its own which, it is concluded, was lawful picketing of an allied employer. No 584 UNITED MINE WORKERS OF AMERICA determination here is made with regard to the alleged unfair labor practices engaged in by Surface as to its employees or the representation matter. (See fn. 1.) IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES The conduct of the Respondent outlined above, occur- ring in connection with the operations of Lone Star as set forth in section I, has a close, intimate, and substantial relationship to trade, traffic, and commerce among the several States and tends to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. V. THE REMEDY Having found that the Respondent has violated the Act by forcing, through strike activity, the Company to accept its demand for a nonmandatory subject of bargaining, I shall recommend that the Respondent be required to cease and desist from continuing such activity. However, inasmuch as the parties agree that other subjects remained to be resolved, I shall not recommend that the strike itself be found to be an unfair labor practice. Rather, it appears that the policies of the Act can be fully effectuated by requiring the Union to withdraw its demand for the application of contract to coal lands clause and to bargain with the Company upon request concerning other matters. I shall also recommend that the Respondent be required to send a copy of the attached notice to its striking members, as well as copies to the Company for posting upon such bulletin boards as the Company may deem appropriate. The Respondent's defense in this matter is certainly not frivolous - it having prevailed on most points - so as to warrant an award against it of costs of litigation incurred by the Company. Lone Star's request for attorneys fees is therefore denied. Cf. Tiidee Products, Inc., 194 NLRB 1234 (1972). CONCLUSIONS OF LAW 1. The Lone Star Steel Company is an employer engaged in interstate commerce within the meaning of Section 2(6) and (7) of the Act. 2. The Respondent is a labor organization within the meaning of Section 2(5) of the Act. 3. The allegation in the complaint that the Respondent violated Section 8(bX3) of the Act by insisting on the Company's acceptance of a nonmandatory subject of bargaining (the application-of-contract to coal lands) has been sustained. 4. The allegation in the complaint that the successor- ship clause is violative of Section 8(e) of the Act has not been sustained. 5. The allegation in the complaint that the Respondent engaged in unfair labor practices within the meaning of Section 8(bX4)i) and (iiXA) of the Act has not been sustained. 6. The allegation in the complaint that the Respondent engaged in picketing activity in violation of Section 8(bX4Xi) and (iiXB) of the Act has not been sustained. [Recommended Order omitted from publication.] 585