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- Annotation 7 - Article II - FindLaw
- Annotation 7 - Article II
- Directive Orders and Opinions of the National War Labor Board in the Little Steel Case
We also are of the view that the bargaining requirements of the Act include all retirement and pension plans or none. Otherwise, as the Board points out, "some employers would have to bargain about pensions and some would not, depending entirely upon the unit structure in the plant and the nature of the pension plan the employer has established or desires to establish. We are satisfied no such construction of the Act can reasonably be made.
It follows that the issue for decision is, as the Board asserts; whether pension and retirement plans are part of the subject matter of compulsory collective bargaining within the meaning of the Act. The contention which we have just discussed has been treated first, and perhaps somewhat out of order, so as to obviate the necessity for a lengthy and detailed statement of the Company's plan.
Briefly, the plan as originally initiated on January 1, , provided for the establishment of a contributory plan for the payment of retirement annuities pursuant to a contract between the Company and the Equitable Life Assurance Society.
Effective December 31, , the plan was extended to cover all employees regardless of the amount of their earnings, provided they had attained the age of 30 and had five years of service. The plan from the beginning was optional with the employees, who could drop out at any time, with rights upon retirement fixed as of that date. On December 28, , the Company entered into an agreement with the First National Bank of Chicago, wherein the Company established a pension trust, the purpose of which was to augment the Company's pension program by making annuities available to employees whose period of service had occurred largely during years prior to the time when participation in the retirement plan was available to them.
These were employees whose retirement date would occur so soon after the establishment of the plan that it would not afford them adequate retirement annuity benefits. The employees eligible to participate in the pension trust were not required to contribute thereto, but such fund was created by the Company's contributions.
An integral and it is asserted an essential part of the plan from the beginning was that employees be compulsorily retired at the age of There are some exceptions to this requirement which are not material here. The Company's plan had been in effect for five and one-half years when, because of the increased demands for production and with a shortage of manpower occasioned by the war, it was compelled to suspend the retirement of its employees as provided by its established program.
In consequence there were no retirements for age at either of the plants involved in the instant proceeding from August 26, to April 1, This temporary suspension of the compulsory retirement rule was abrogated, and it was determined by the Company that no retirements should be deferred beyond June 30, By April 1, , all of the Company's employees, some in number, who had reached the age of 65, had been retired. Thereupon, the Union filed with the Company a grievance protesting its action in the automatic retirement of employees at the age of The Company refused to discuss this grievance with the Union, taking the position that it was not required under the Act to do so or to bargain concerning its retirement and pension plan, and particularly concerning the compulsory retirement feature thereof.
Whereupon, the instant proceeding was instituted before the Board, with the result already noted. This brings us to the particular language in controversy. The instant controversy has to do with the construction to be given or the meaning to be attached to the italicized words; in fact, the controversy is narrowed to the meaning to be attached to the term "wages" or "other conditions of employment.
As to the former it stated in its decision:. The Board also found and concluded that in any event a retirement and pension plan is included in "conditions of employment" and is a matter for collective bargaining. After a careful study of the well written briefs with which we have been favored, we find ourselves in agreement with the Board's conclusion.
In fact, we are convinced that the language employed by Congress, considered in connection with the purpose of the Act, so clearly includes a retirement and pension plan as to leave little, if any, room for construction. While, as the Company has demonstrated, a reasonable argument can be made that the benefits flowing from such a plan are not "wages," we think the better and more logical argument is on the other side, and certainly there is, in our opinion, no sound basis for an argument that such a plan is not clearly included in the phrase, "other conditions of employment.
And we find nothing in the numerous authorities called to our attention or in the legislative history so strongly relied upon which demonstrates a contrary intent and purpose on the part of Congress. The opening sentence in the Company's argument is as follows: "Sections 8 5 and 9 a of the Act do not refer to industrial retirement and pension plans, such as that of the petitioner, in haec verba. Illustrative are the numerous matters concerning which the Company and the Union have bargained and agreed, as embodied in their contract of April 30, A few of such matters are: a provision agreeing to bargain concerning nondiscriminatory discharges; a provision concerning seniority rights, with its far reaching effect upon promotions and demotions; a provision for the benefit of employees inducted into the military service; a provision determining vacation periods with pay; a provision concerning the safety and health of employees, including clinic facilities; a provision for in-plant feeding, and a provision binding the Company and the Union to bargain, in conformity with a Directive Order of the National War Labor Board concerning dismissal or severance pay for employees displaced as the result of the closing of plants or the reduction in the working force following the termination of the war.
None of these matters and many others which could be mentioned are referred to in the Act "in haec verba," yet we think they are recognized generally, and they have been specifically recognized by the Company in the instant case as proper matters for bargaining and, as a result, have been included in a contract with the Union.
Some of the benefits thus conferred could properly be designated as "wages," and they are all "conditions of employment. We are unable to differentiate between the conceded right of a Union to bargain concerning a discharge, and particularly a nondiscriminatory discharge, of an employee and its right to bargain concerning the age at which he is compelled to retire. In either case, the employee loses his job at the command of the employer; in either case, the effect upon the "conditions" of the person's employment is that the employment is terminated, and we think, in either case, the affected employee is entitled under the Act to bargain collectively through his duly selected representatives concerning such termination.
In one instance, the cessation of employment comes perhaps suddenly and without advance notice or warning, while in the other, his employment ceases as a result of a plan announced in advance by the Company. And it must be remembered that the retirement age in the instant situation is determined by the Company and forced upon the employees without consultation and without any voice as to whether the retirement age is to be 65 or some other age. The Company's position that the age of retirement is not a matter for bargaining leads to the incongruous result that a proper bargaining matter is presented if an employee is suddenly discharged on the day before he reaches the age of 65, but that the next day, when he is subject to compulsory retirement, his Union is without right to bargain concerning such retirement.
The Company, however, attempts to escape the force of this reasoning by arguing that the retirement provision affects tenure of employment as distinguished from a condition of employment. The argument, as we understand, rests on the premise that the Act makes a distinction between "tenure of employment" and "conditions of employment," and attention is called to the use of those terms in Secs. Having thus asserted this distinction, the argument proceeds that tenure of employment is not embraced within the term "conditions of employment.
The tenure of employment is terminated just as effectively by a discharge for cause as by a dismissal occasioned by a retirement provision. And in both instances alike, the time of the termination of such tenure is determined by the Company. As already shown, a termination by discharge is concededly a matter for collective bargaining. To say that termination by retirement is not amenable to the same process could not, in our judgment, be supported by logic, reason or common sense.
In our view, the contention is without merit.ruperkeifilhai.ml
Annotation 7 - Article II - FindLaw
The Company also concedes that seniority is a proper matter for collective bargaining and, as already noted, has so recognized by its contract with the Union. It states in its brief that seniority is "the very heart of conditions of employment. What would be the purpose of protecting senior employees against lay-off when an employer could arbitrarily and unilaterally place the compulsory retirement age at any level which might suit its purpose? If the Company may fix an age at 65, there is nothing to prevent it from deciding that 50 or 45 is the age at which employees are no longer employable, and in this manner wholly frustrate the seniority protections for which the Union has bargained.
Again we note that discharges and seniority rights, like a retirement and pension plan, are not specifically mentioned in the bargaining requirements of the Act. The Company in its brief as to seniority rights states that it "affects the employee's status every day. We think such reasoning is without logic. Suppose that a person seeking employment was offered a job by each of two companies equal in all respects except that one had a retirement and pension plan and that the other did not.
We think it reasonable to assume an acceptance of the job with the company which had such plan.
Annotation 7 - Article II
Of course, that might be described merely as the inducement which caused the job to be accepted, but on acceptance it would become, so we think, one of the "conditions of employment. It surely cannot be seriously disputed but that such a pledge on the part of the company forms a part of the consideration for work performed, and we see no reason why an employee entitled to the benefit of the plan could not upon the refusal of the company to pay, sue and recover such benefits.
In this view, the pension thus promised would appear to be as much a part of his "wages" as the money paid him at the time of the rendition of his services. But again we say that in any event such a plan is one of the "conditions of employment. The Company makes the far fetched argument that the contributions made to a pension plan "differ in no respect from a voluntary payment that might be made to each employee on his marriage, or on the birth of a child, or on attaining the age of 50, or on enlisting in the armed forces in time of war or on participating as a member of a successful company baseball team," but we think there is a vast difference which arises from the fact that such hypothetical payments are not made as the result of a promise contained in a plan or program.
They represent nothing more than a gift.
Directive Orders and Opinions of the National War Labor Board in the Little Steel Case
Assume, however, that such supposed payments were made to employees as a result of a company obligation contained in a plan or program. Such an obligation would represent a part of the consideration for services performed, and payments made in the discharge of such obligation would, in our view, be "wages" or included in "conditions of employment. The Board cites a number of authorities wherein the term "wages" in other fields of law has been broadly construed in support of its conclusion in the instant case that the term includes retirement and pension benefits for the purpose of collective bargaining.
While we do not attach too much importance to the broad interpretation given the term in unrelated fields, we think they do show that a broad interpretation here is not unreasonable. For instance, the Board has been sustained in a number of cases where it has treated for the purpose of remedying the effects of discriminatory discharges, in violation of Sec. See Butler Bros.
Stackpole Carbon Co. In the latter case, the court stated F. In the Social Security Act, 49 Stat. Nierotko, U. In the field of taxation, pension and retirement allowances have been deemed to be income of the recipients within the Internal Revenue Act definition of wages as "compensation for personal services. Thus, in Hooker v. Hoey, D. The Company in its effort to obtain a construction of Sec. In view of what we have said, this argument may be disposed of without extended discussion.
It is sufficient to note that we have studied this legislative history and, while there are some portions of it which appear to support the company's position, yet taken as a whole it is not convincing. It would, in our judgment, require a far stronger showing of congressional intent than exists here before we would be justified in placing a construction upon the provision in question which would do violence to the plain words of the statutory requirement and which would result in an impairment of the purpose of the Act. It may be true, as argued by the Company, that retirement and pension plans were employed only to a limited extent in , when the original Act was passed.
Such provisions, however, were being generally used at the time of the passage of the amended Act in And we doubt the validity of the argument that the language of the latter Act cannot be given a broader scope even though Congress used the same phraseology. We do not believe that it was contemplated that the language of Sec. Congress in the original as well as in the amended Act used general language, evidently designed to meet the increasing problems arising from the employer-employee relationship. As was said in Weems v.
United States, U. Time works changes, brings into existence new conditions and purposes. Therefore a principle to be vital must be capable of wider application than the mischief which gave it birth. The Company places great stress upon the bargaining language used in the Railway Labor Act of , 45 U. It points out that numerous retirement and pension plans were put into effect by the railroads and that they were never subjected to the process of collective bargaining.
This showing is made for the purpose of demonstrating that Congress in the enactment of the legislation now before us did not intend to include such matters. In this connection, we think it is pertinent to note that in the Railway Labor Act the bargaining language was quite different from that of the instant legislation. There, it read, "rates of pay, rules, or working conditions. Certainly the term "wages" was intended to include something more than "rates of pay. Congress in the instant legislation used the phrase, "other conditions of employment," instead of the phrase, "working conditions," which it had previously used in the Railway Act.
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We think it is obvious that the phrase which it later used is more inclusive than that which it had formerly used. Even though the disputed language of the instant Act was open to construction, we think a comparison of the language of these two Acts is of no benefit to the Company. The Company places much reliance upon a statement from the opinion in J.
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While the court was not considering a question such as that with which we are now concerned, we think it must be conceded that the language furnishes some support for the Company's position, and if this case stood alone as the sole expression of the Supreme Court relative to the question before us it would at least cause us to hesitate; however, in a later case, United States v. United Mine Workers of America, U. Again, however, the question here presented was not before the court and we do not regard either of these cases as an expression of the view of the Supreme Court upon the instant question.
The support which the Company professes to find in the Case case is at least offset by the court's statement in the United Mine Workers case. It is our view, therefore, and we so hold that the order of the Board, insofar as it requires the Company to bargain with respect to retirement and pension matters, is valid, and the petition to review, filed by the Company in No. This brings us to the Union's petition for review of the order in No.