Allied Chemical v. Pittsburgh Plate Glass
In Allied Chemical and Alkali Workers v. Pittsburgh Plate Glass Co., 404 U.S. 157, 92 S.Ct. 383, 30 L.Ed.2d 341 (1971), the employer was charged with an unfair labor practice because it had unilaterally made a mid-term modification of benefits to its retired employees.
The National Labor Relations Board concluded that retirement benefits of already retired employees was a mandatory subject of bargaining.
The court of appeals disagreed, holding that "retirees are not 'employees' within the meaning of section 8(a)(5) and (so) the Company was under no constraint to collectively bargain improvements in their benefits with the Union." Pittsburgh Plate Glass Co. & Chemical Division v. NLRB, 427 F.2d 936, 942 (6th Cir. 1970).
The Supreme Court affirmed, holding that retirees were not "employees" and could not be included in the bargaining unit. Allied Chemical, supra, 404 U.S. at 170, 92 S.Ct. 383.
In Allied Chemical and Alkali Workers of America v. Pittsburgh Plate Glass Co., 404 U.S. 157, 92 S.Ct. 383, 30 L.Ed.2d 341 (1971), the Supreme Court held that an employer did not have to bargain with its union over health benefits of retired employees (who were no longer employees) because the issue did not have a "vital effect" on bargaining unit employees.
In Allied Chemical & Alkali Workers, Local Union No. 1 v. Pittsburgh Plate Glass Co., 404 U.S. 157, 159, 92 S.Ct. 383, 30 L.Ed.2d 341 (1971), the Supreme Court considered whether a midterm modification of retirees' insurance benefits was an unfair labor practice.
The company sought to modify its contributions to the retirees' health benefits because Medicare was enacted. Id. at 161, 92 S.Ct. 383.
The National Labor Relations Board found that the retirees' benefits were a mandatory subject of collective bargaining. Id. at 162, 92 S.Ct. 383.
The Supreme Court held that the Board's decision was not supported by law; that the term "employee" does not include retired workers; that the retired workers are not employees included in the collective bargaining unit; and that retired workers' benefits are only a permissive subject of collective bargaining. Id. at 166-82, 92 S.Ct. 383.
Nevertheless, the Supreme Court recognized that a union and company may agree to bargain for retirees' benefits, and once these bargained-for benefits are vested, retired workers may have contract rights under the collective bargaining agreement which they could enforce pursuant to 301 of the Labor Management Relations Act if the benefits are changed. Id. at 181, 92 S.Ct. 383, n. 20.
In Allied Chemical & Alkali Workers, Local No. 1 v. Pittsburgh Plate Glass Co., 404 U.S. 157, 92 S.Ct. 383, 30 L.Ed.2d 341 (1971), the Supreme Court held that the employer had no obligation under the National Labor Relations Act to bargain over retired employees because the statute imposes a duty to bargain only with respect to "employees" and "the ordinary meaning of 'employee' does not include retired workers; retired employees have ceased to work for another for hire." Id. at 168, 92 S.Ct. at 392.
Justice Brennan, writing for the court quoted approvingly from the Sixth Circuit's decision under review, id. at 165, 92 S.Ct. at 390, where the court described retirement as follows:
"Retirement with this Company, as with most other companies, is a complete and final severance of employment. Upon retirement, employees are completely removed from the payroll and seniority lists, and thereafter they perform no services for the employer, are paid no wages, are under no restrictions as to other employment or activities, and have no rights or expectations of re-employment." Pittsburgh Plate Glass Co. v. NLRB, 427 F.2d 936, 944 (6th Cir. 1970).
In Allied Chemical & Alkali Workers v. Pittsburgh Plate Glass Co., 404 U.S. 157 (1971), the Court held that retirees are not "employees" under the National Labor Relations Act ("NLRA") and are not protected by the mandatory bargaining provisions of the NLRA. Id. at 172.
The Court also said that "since retirees are not members of the bargaining unit, the bargaining agent is under no statutory duty to represent them in negotiations with the employer." Id. at 181 n.20.
The court resolved the tension between this statement and the holding in Howard by noting that although"the reach and rationale of Howard are a matter of some conjecture . . . Howard obviously does not require a union affirmatively to represent non-bargaining unit members or to take into account their interests in making bona fide economic decisions in behalf of those whom it does represent." Id.
In Allied Chemical & Alkali Workers of America, Local Union No. 1 v. Pittsburgh Plate Glass Co., Chemical Division, 404 U.S. 157, 178, 92 S.Ct. 383, 397, 30 L.Ed.2d 341 (1971), the Court defined a subject for mandatory bargaining as including only those issues that settle an aspect of the employer-employee relationship.
Although matters involving individuals outside the employment relationship do not normally fall within that definition, they are not entirely excluded.
The test 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." 404 U.S. at 179, 92 S.Ct. at 397-98.
In Allied Chemical & Alkali Workers of America v. Pittsburgh Plate Glass Co., 404 U.S. 157, 92 S.Ct. 383, 30 L.Ed.2d 341 (1971), the Court held that retirees were not employees for collective bargaining purposes and could not be included within the bargaining unit.
The opinion recognizes that the union representatives on occasion might see fit to bargain for improved wages or other conditions favoring active employees at the expense of retirees' benefits. 404 U.S. at 173, 92 S.Ct. 383.
Moreover, even though retirees may be included in health and welfare contracts, "(h)aving once found it advantageous to bargain for improvements in pensioners' benefits, active workers Are not forever thereafter bound to that view or obliged to negotiate on behalf of retirees again." Id. at 181, 92 S.Ct. at 398.
In a footnote the Court states that, "This does not mean that when a union bargains for retirees which nothing in this opinion precludes if the employer agrees the retirees are without protection. Under established contract principles, Vested retirement rights may not be altered without the pensioner's consent . . . . The retiree, moreover, would have a federal remedy under 301 of the Labor Management Relations Act for breach of contract if his benefits were Unilaterally changed." Id. at 181 n. 20, 92 S.Ct. at 398-399.