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U.S. Supreme Court

First Nat'l Maintenance Corp. v. NLRB, 452 U.S. 666 (1981)

First National Maintenance Corp. v. National Labor Relations Board

No. 80-544

Argued April 21, 1981

Decided June 22, 1981

452 U.S. 666


Petitioner, a company engaged in the business of providing housekeeping, cleaning, maintenance, and related services for commercial customers, had a contract to do maintenance work for a nursing home. As a result of a dispute with the home over the size of the management fee, petitioner terminated the contract, and petitioner's employees who worked at the nursing home were discharged. While the contract was still in effect, a labor union was certified as the bargaining representative for petitioner's employees at the nursing home. The union, upon learning of petitioner's intention to discharge these employees, requested a delay from petitioner for the purpose of bargaining, but petitioner refused to bargain. The union then filed an unfair labor practice charge against petitioner, alleging violation of its duty to bargain in good faith "with respect to wages, hours, and other terms and conditions of employment" under §§ 8(d) and 8(a)(5) of the National Labor Relations Act. The National Labor Relations Board upheld the charge and ordered petitioner, if it agreed to resume the nursing home operations, to reinstate the discharged employees or, if agreement was not reached, to offer the employees equivalent jobs at its other operations. The Court of Appeals enforced the Board's order, holding that, while no per se rule could be formulated to govern an employer's decision to close part of its business, § 8(d) creates a presumption in favor of mandatory bargaining over such a decision, which presumption is rebuttable by showing that the purposes of the NLRA would not be furthered by imposing a duty to bargain.

Held: Although required to bargain about the effects of such a decision, petitioner had no duty to bargain over its decision to terminate the nursing home contract. The facts of Fibreboard Paper Products Corp. v. NLRB, 379 U. S. 203, distinguished. Pp. 452 U. S. 674-688.

(a) In view of an employer's need for unencumbered decisionmaking in the conduct of its business, bargaining over management decisions that have a substantial impact on the continued availability of employment should be required only if the benefit, for labor-management relations

Page 452 U. S. 667

and the collective bargaining process, outweighs the burden placed on the conduct of the business. Pp. 452 U. S. 674-680.

(b) The harm likely to be done to an employer's need to operate freely in deciding whether to shut down part of its business purely for economic reasons outweighs the incremental benefit that might be gained through the union's participation in making that decision. The decision itself is not part of § 8(d)'s "terms and conditions of employment" over which Congress has mandated bargaining. Pp. 452 U. S. 680-686.

627 F.2d 596, reversed and remanded.

BLACKMUN, J., delivered the opinion of the Court, in which BURGER, C.J.,and STEWART, WHITE, POWELL, REHNQUIST, and STEVENS, JJ., joined. BRENNAN, J., filed a dissenting opinion, in which MARSHALL, J., joined, post, p. 452 U. S. 688.

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