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Union Strike Power Under Threat as Supreme Court Mulls Labor Law

Oct. 11, 2022, 9:08 AM

An upcoming US Supreme Court case has the potential to chill unions’ use of strikes as a bargaining strategy and tilt the balance of power in labor-management relations more toward businesses.

The justices last week agreed to consider the question of whether there’s an exception to federal labor law preemption of state lawsuits if the employer makes common-law allegations of intentional destruction of property during a labor dispute.

Such an exception likely will trigger costly employer lawsuits against striking unions based on the economic consequences of their protests and spark legislation in conservative-leaning states to restrict union conduct during strikes, labor law observers said.

VIDEO: Union Busting: What Employers Can and Cannot Legally Do

“Functionally, strikes provide bargaining power, offsetting the inherent differences in power between workers and employers,” said Julie Gutman Dickinson, a union-side attorney with Bush Gottlieb ALC and former National Labor Relations Board lawyer. “Any curtailment of that right threatens to weaken the very basis of labor law.”

The Supreme Court decided to take up the case amid a period of heightened strike action that began a year ago—a period dubbed “Striketober”—and hasn’t let up, an analysis of Bloomberg Law labor data shows.

The right to strike—and cause economic harm while doing so—is protected by the National Labor Relations Act, but it’s not an unconditional right. The NLRA puts up several limitations and qualifications, including the requirement that striking workers take reasonable precautions to protect their employers’ property from foreseeable hazards because of sudden work stoppages.

Concrete Damage

International Brotherhood of Teamsters Local 174 said in court papers that striking truck drivers at ready-mix concrete supplier Glacier Northwest Inc. did take such measures before their one-week walkout in 2017. The drivers returned loaded trucks to the company’s yard and left them running so they could be safely unloaded, the union said.

But Seattle-based Glacier Northwest, which does business as CalPortland, sued Local 174 in Washington state court for intentional destruction of property. The union, the company alleged, timed the work stoppage so the concrete would harden in the trucks’ mixing drums.

The Washington Supreme Court ruled the company’s claims were preempted under the Supreme Court’s 1959 decision in San Diego Building Trades Council v. Garmon, which blocks state and local regulation of activities that federal labor law arguably protects or prohibits.

The strike was arguably protected, the state high court said, and to go any further would violate Garmon’s instruction that such fact-specific determinations are left to the NLRB.

Invitation to Sue

The Glacier Northwest case, which hasn’t yet been scheduled for oral argument, marks the first time the Supreme Court could dial back union power since its 2018 decision in Janus v. AFSCME, Council 31, which struck down longstanding precedent that had allowed public sector unions to require nonmembers to pay for the costs of collective bargaining and other nonpolitical expenses.

Glacier Northwest’s allegations against Local 174 equate economic damage with intentional sabotage, but every strike creates some economic damage, said Anne Lofaso, a labor law professor at West Virginia University and a former NLRB attorney.

A Supreme Court decision permitting Glacier Northwest’s lawsuit to remain in state court would prompt employers to reframe other types of financial harm stemming from worker walkouts as intentional property destruction, labor law observers said.

“As a matter of reflexive litigation policy, if the court provides an opening for certain legal theories, regardless of how valid they are, then it’s almost given litigants an invitation to try them,” said Michael Duff, a labor law professor at St. Louis University and a former NLRB lawyer.

But there’s a high bar for proving intentional conduct under common law that could make those lawsuits hard to prove in state court, potentially limiting the litigation that flows from a new exception to Garmon preemption, Duff added.

Broader Ruling?

Although Glacier Northwest’s Supreme Court petition seeks a relatively limited exception, the justices could go big and do away with the Garmon doctrine entirely, some legal observers said.

Such a move would have enormous consequences to labor-management relations.

“A country without Garmon preemption would look a lot like the country before the National Labor Relations Act,” said Benjamin Dictor, a union-side attorney with Eisner Dictor & Lamadrid PC.

But Marshall Babson, a former NLRB member who represents employers at Seyfarth Shaw LLP, said Garmon preemption isn’t in jeopardy.

While the justices may disagree on the analysis in the Glacier Northwest case, the principles of Garmon are well-accepted, built on the US Constitution’s Supremacy Clause, and play a vital role in the country’s economy, he said.

“Preemption is important in labor law because otherwise national employers or employers operating in multiple states would be subject to a patchwork of regulations,” Babson said. “That’s not consistent with good business, good commerce, or the economic well-being of the country.”

The case is Glacier Northwest, Inc. v. Int’l Bhd. of Teamsters Local Union No. 174, U.S., No. 21-1449.

To contact the reporter on this story: Robert Iafolla in Washington at riafolla@bloomberglaw.com

To contact the editor responsible for this story: Laura D. Francis at lfrancis@bloomberglaw.com