1 - National Labor Relations Board

Enforcement Litigation 155
over, the court viewed as "startling" the proposition that the
national labor policy, which the Board was created to further,
required that considerations of efficiency and economy be completely
disregarded in assigning disputed work. In the instant
case, the factors of efficiency and economy clearly favored awarding
the work to the telephone workers. The work did not require
the skill possessed by the electrical workers ; the telephone workers
could be trained to do it in a few hours. The pay rate of the
telephone workers was considerably lower than that of the electrical
workers. Under these circumstances, the Board's order
awarding the work to the telephone workers on the basis of
efficiency and economy was found not to be arbitrary or capricious
and the Board's order was enforced.
D. Remedial Order Provisions
1. Successor Employer's Obligation To Remedy
Predecessor's Unfair Labor Practices
In the U.S. Pipe & Foundry case, 76 the Fifth Circuit upheld the
Board's action in ordering an employer, which had purchased
the assets of another company with notice that unfair labor
practice proceedings were pending against the other company,
and continued to operate the same business in the same manner
and with substantially the same work force, to remedy its predecessor's
unfair labor practices by reinstating employees discriminatorily
discharged by the predecessor. In the court's view,
this order properly balanced the equities in favor of effectuating
the policy of the Act by protecting the employees. While the
successor was a bona fide purchaser, it had purchased the business
with notice of the pending proceedings, and it alone could reinstate
the employees to their old jobs which still existed. The
successor was not required to create jobs or to provide backpay
to the employees. The court pointed out that the Board's action
was supported by the Supreme Court's decision in John Wiley &
Sons v. Livingston," holding that an arbitration agreement was
binding on a purchaser where a similarity and continuity of
operation across the transfer of ownership were shown. While
the Board's decision in the instant case, made in reliance on
Wiley, represented a change in policy, the possibility of such a
change was a risk entailed in the purchase of a business with
notice of pending proceedings.
78 U.S. Pipe & Foundry Co. v. N.L.R.B., 398 F.26 544.
77 376 U.S. 543 (1964).