The Supreme Court, in a major victory for labor, yesterday ruled 8 to 1 that unions can strike to force employers to join established multiemployer trust funds, averting what labor saw as the probable gutting of such trusts.
The court, in an ipinion written by Justice Potter Stewart, overturned a lower court fuling in a case affecting millions of dollars in national multi-employer pension and welfare funds and about 8 million workers in industries such as mining, apparel, retail trades, maritime and construction, government and private labor experts said. Justice John Paul Stevens dissented.
The decision's impact, labor experts said, seemed to focus on what the justices could have done but didn't. If an opposite ruling had been made, labor experts said, unions could have been, prohibited from striking over demands that employuers join such trust funds. Without the union's strike clout, many companies paying into such trusts would not feel compelled to stay and might withdraw. "It would have wrecked multiemployer funds for mine workers," said United Mine Workers union general counsel Harrison Combs. The mine workers fund is about $1.25 billion, Combs said.
The case arose from a dispute between the Amax Coal Co. and union workers in a Wyoming coal field. Many coal operators pay into a national multiemployer pension and welfare fund whose three trustees are selected nationally by labor, management and jointly by the two sides.
Amax declined to pay into the multiemployer fund for the Wyoming workers. When the union's contract expired, the union demanded that Amax join the multiemployer fund. When Amax didn't, the union went on strike.
Amax claimed the multiemployer fund had already been established and that it had not participated in the selection of the management-appointed trustee picked by the other employers. Amax contended the trustee was a collective bargaining agent, and under law a union cannot coerce a company to accept a particular representative. By striking to force the company to pay into the trust, the union was illegally coercing it to accept the collective bargaining representative, Amax argued.
The justices said that although the management-appointed trustee is selected by the employers, he is beholden only to the employes and their welfare, not management. "In sum, the duty of the management-appointed trustee of an employe benefit fund . . . is directly antithetical to that of an agent of the appointing party," the court said.
The court said the trustee is a fiduciary "whose duty to the trust beneficiaries must overcome any loyalty to the interest of the party that appointed him. Thus the statutes defining the duties of a management-appointed trustee make it virtually self-evident that welfare fund trustees are not 'representatives for the purposes of collective bargaining or the adjustment of grievances' " under law.
"But close examination of the latter provision makes it even clearer that [the law] "does not limit the freedom of a union to try to induce an employer to select a particular . . . trustee," the court continued.
The UMW's Combs said the court's ruling "was a landmark decision.
A different decision also could have meant many companies would have withdrawn from the multiemployer trusts because unions would be prevented from using their strike powers to force employers to join them, an NLRB spokesman said.
A spokesman for the Bituminous Coal Operators Association said the decision maintains the status quo.