Applicability of U.S. Labor Law to Issues, Disputes and
Relationships That Include Foreign Conduct of Components

By Stephen B. Moldof

October 2007

Relationships between U.S. employers and employees are no longer confined to activities occurring within the borders of the United States. The shifting of work overseas, the development of relationships between U.S. and foreign companies, and the involvement of governments of different nations in matters involving the workplace have created an environment that requires a new focus on the determination of the rules that will govern labor-management relationships with international components.
In the airline industry, expanded globalization is reflected in, among other things, the following:
 
. The forging of relationships or "alliances" through which U.S.-certificated carriers and foreign carriers have coordinated frequent flyer programs; airport lounges; marketing of flights; pricing; scheduling; and/or maintenance.
 
. Code-sharing of international flights which has enabled a single flight to be marketed as if it was the flight of several different carriers of different nations.

. Acquisition by carriers of ownership interests in carriers headquartered in other nations.
As a result of these and other globalization developments, it is increasingly difficult to classify flight activities as belonging to individual nations. And, with national geographic boundaries no longer defining flights and flight activities, the issue of determining which nation's laws will apply in particular situations becomes an increasingly complex exercise.
We will first review the legal principles that have been applied when disputes between U.S. companies and their employees have included foreign components or activities -- so-called "extraterritorial" conduct. We will then contrast those principles with others that have been applied in adjudicating non-labor, commercial disputes related to extraterritorial activities of U.S. concerns. Finally, we will attempt to square the case law with the reality of the current airline industry and offer some suggestions for realistically addressing issues that presently exist or that are likely to surface in the near future. n1 
n1 While the focus of this discussion is primarily on developments in the airline industry, related issues have also arisen in the context of the railroad industry. See supra, pp. 4-5 n.8.
 
I.	Determining Which Laws Apply to the Relations of U.S. Companies and Employees When the Issues Presented Include “Extraterritorial” Components
In evaluating disputes between U.S. companies and their employees in an "extraterritorial" context, a critical threshold issue is determining which nation's laws govern.
A. An Overview of the Applicable Standards
Some courts, faced with the dilemma of determining which nation's laws apply to the relations of U.S. employers and employees involved in activities outside the U.S., have taken as their starting analytical point the so-called "non-extraterritorial presumption." This presumption recognizes that: (1) while United States statutes can be enforced beyond the territorial boundaries of the United States; (2) they will not be presumed to apply outside the U.S. in the absence of some indication that Congress so intended ("long-standing principle of American law ... that Congress legislates against the backdrop of the presumption against extraterritoriality"). EEOC v. Arabian American Oil Co., 499 U.S. 244 (1991). n2
n2 Arabian American held that Title VII of the Civil Rights Act of 1964, as amended, did not apply extraterritorially to regulate the employment practices of United States employers as they applied to U.S. citizens working abroad. To directly override this Supreme Court decision, Congress amended Title VII to include within its protections U.S. citizens who work overseas for U.S. businesses. Section 109(a) of the Civil Rights Act of 1991, 42 U.S.C. §2000e(f) (1991).
 
Other courts have applied a different analytical approach, focusing on the "effects" of the extraterritorial conduct in question within the United States (the "effects test") or on the extent to which the conduct occurs within the U.S. as well as extraterritorially (the "conduct test"). Since there appears to be nothing in the reasoning underlying the effects and conduct tests which would exclude the applicability of these standards in a labor context, we will address these tests as well as the non-extraterritorial presumption.
B. Application of the Non-Extraterritorial Presumption
Long before the Supreme Court's decision in Arabian American, courts applied the non-extraterritorial presumption to find that activities abroad of employees of U.S. companies were not governed by the National Labor Relations Act ("NLRA"), n3 the Labor Management Relations Acts ("LMRA"), n4 or the Eight Hour Law. n5
n3 McCulloch v. Sociedad Nacional de Marineros de Honduras, 372 U.S. 10, 12-13(1963) (petition by U.S. union seeking to represent seaman of Honduran subsidiary of U.S. corporation dismissed because NLRA does not extend to maritime operations of foreign flagships employing alien seamen); For a more recent similar result, see Asplundh Tree Export Co. v. NLRB, 365 U.S. 168 (3d Cir. 2004) (holding that the non-extraterritorial presumption required the Court to refuse enforcement of an NLRB determination that employer engaged in unfair labor practice in terminating employees of an American company working temporarily in Canada in response to their protest against their terms and conditions of employment).
 
n4 Benz v. Compania Naviera Hidalgo, S.A., 353 U.S. 138 (1957) (LMRA inapplicable to picketing by U.S. union of foreign ship operated by foreign seamen, even though the ship was temporarily in an American port when the picketing took place). For a post-Arabian-American decision, see Labor Union of Pico Korea v. Pico Products, 968 F.2d 191 (2d Cir.), cert. denied, 506 U.S. 985 (1992) (LMRA does not provide jurisdiction over alleged violations of labor contracts between Korean labor union and Korean corporation regarding work of Korean citizens in Korea; fact that actions of American parent of Korean corporation allegedly caused the contractual violations was an insufficient basis for holding U.S. law applicable).
n5 Foley Bros. v. Filardo, 336 U.S. 281, 285 (1949) (Eight Hour Law inapplicable to contract between the United States and a private contractor for construction work in Iraq and Iran).
 
Shortly before the Arabian American decision, the presumption against extraterritoriality was applied in an RLA setting in Independent Union of Flight Attendants v. Pan Am World Airways, Inc., 923 F.2d 678 (9th Cir. 1991) (referred to hereafter as the "Berlin Express" case) n6 to deny statutory coverage to a dispute between a U.S. carrier and the union representing its flight attendants involving flying wholly outside the United States.
n6 The Ninth Circuit's decision subsequently was withdrawn as moot and remanded to the District Court, 966 F.2d 457, 460 (9th Cir. 1992), but the lower court declined to vacate its original decision which had refused to enforce the collective bargaining agreement on the basis of the non-extraterritoriality presumption. 810 F.Supp. 263 (N.D. Cal. 1992).
 
In Berlin Express, the collective bargaining agreement ("CBA") between Pan American World Airways ("Pan Am") and the Independent Union of Flight Attendants ("IUFA") contained a scope clause that required Pan Am to use flight attendants on the Pan Am flight attendants' system seniority list for all present and future flying. By a letter agreement, this scope clause was explicitly applicable to Pan Am Corp., the parent of Pan Am. Similar scope clauses had been included previously in CBAs with IUFA's predecessor, the Transport Workers Union ("TWU"), and with the Air Line Pilots Association ("ALPA"), the union representing Pan Am's pilots.
Despite these agreements and the long-established practice of using seniority list flight attendants on intra-European flights, n7 Pan Am suddenly shifted flights within Europe to another Pan Am Corp. subsidiary, Pan Am Express, marketed the flights as the "Berlin Express," and staffed the flights with foreign national flight attendants represented by a German union rather than with Pan Am seniority list flight attendants represented by IUFA. IUFA filed a grievance which Pan Am refused to arbitrate because it claimed that the dispute raised issues beyond the jurisdiction of the system board. The union's action to compel arbitration was dismissed for lack of subject matter jurisdiction on the ground that the RLA does not apply extraterritorially, and the Ninth Circuit affirmed, by a 2-1 vote.
n7 Consistent with this past practice at Pan Am, U.S. carriers began to base flight crews overseas virtually with the inception of the airline industry. In most instances where carriers have based flight crews outside the U.S., they have treated their foreign-based flight crews as covered under the same collective bargaining agreements, negotiated under the RLA, and subject to the same union representation as applied to U.S.-based employees performing the same job functions.
 
The majority and dissenting opinions of the Ninth Circuit in Berlin Express reflect the differing approaches that jurists may follow in determining whether U.S. law should or should not apply to a labor law dispute involving a U.S. employer's operations in an international context.
The Berlin Express majority reasoned that because it could find no clear expression of congressional intent to apply the RLA or the Interstate Commerce Act ("ICA") to "purely foreign flying," 923 F.2d at 683, the non-extraterritoriality presumption was applicable and the court therefore lacked jurisdiction to entertain IUFA's suit:
 
[t]he presumption against extraterritoriality, in conjunction with Congress' careful and thorough definitions of commerce, compels the conclusion that the RLA does not prescribe substantive law with respect to flights which are not within its definitions of commerce.
 
923 F.2d at 683. n8 The majority considered this result required even though, as it recognized, RLA contracts are governed and enforceable by federal law and the RLA mandates precisely the arbitral resolution of contractual disputes that IUFA was seeking through its lawsuit:
 
[c]oncern for compliance with the statutory mandate need not and should not extend beyond the scope of that mandate itself. Since, as we have seen, the RLA does not apply to purely foreign flying, no substantial question of federal law appears to be raised by an action to enforce an arbitration agreement with respect to such flying.
 
923 F.2d at 683-84. Moreover, the majority noted that the parties could not, by voluntary agreement, confer jurisdiction over what amounted to purely foreign flying. n9 
n8 The Berlin Express majority noted that "virtually every court to consider the question has concluded that Congress did not intend the RLA to govern labor disputes in other countries." 923 F.2d at 682. However, all the prior decisions involved employees based outside the U.S. who worked exclusively outside the U.S., and who, in almost all instances, were "foreign nationals." See Air Line Stewards Ass'n v. Northwest Air Lines, Inc., 267 F.2d 170, 172-73 (8th Cir.), cert. denied, 361 U.S. 901 (1959); Air Line Stewards Ass'n Int'l v. Trans World Airlines, 273 F.2d 69, 71 (2d Cir.), cert. denied, 362 U.S. 988 (1960); Air Line Dispatchers Ass'n v. National Mediation Bd., 189 F.2d 685, 690 (D.C. Cir.), cert. denied, 342 U.S. 849 (1951). See also Allen v. CSX Corp., 22 F.3d 1180 (D.C. Cir. 1994) (Canadian employees who worked exclusively outside the U.S. not covered by RLA); cf. Van Blaricom v. Burlington Northern R.R., 17 F.3d 1224 (9th Cir. 1994) (labor protective benefits awarded by Interstate Commerce Commission inapplicable because applicant was a Canadian citizen who had worked solely in Canada and the ICA does not apply extraterritorially). The Berlin Express majority did not purport to treat any of the prior "extraterritorial" decisions as dispositive, as in none of the cases had courts been called upon to consider the enforceability of an existing contract. 923 F.2d at 682.
 
n9 The Berlin Express majority suggested that IUFA's breach of contract claim could be heard in state court. Id. at 684 n. 10. A similar possibility was noted in Allen v. CSX. 22 F.3d at 1182-83. It is difficult to understand how such state law claims based on alleged breaches of CBAs would not be federally preempted or why actions asserting such claims would not be removable to federal court if brought initially in state court.
 
The dissenting judge in Berlin Express believed that the court should never have reached the extraterritoriality issue, as what was at issue was simply an action to compel arbitration over a "domestic agreement" -- a "routine agreement between a union and a carrier" -- which explicitly covered intra-European flying and thus provided a "domestic 'hook' on which to hang the controversy that neither party could unilaterally modify by virtue of the RLA." 923 F.2d at 685 (Nelson, J., dissenting). As Judge Nelson further explained,
 
it is not the RLA that must be stretched beyond our boundaries; it is the agreement that brings us there. ... The RLA may have no operation in another country; that does not mean, however, that the agreements which the RLA purports to guarantee are limited in any way by territorial or national boundaries.
 
Id.
The dissenting judge would have found the exercise of jurisdiction warranted because: (1) this dispute would have a "substantial, direct, and foreseeable effect upon or in the territory" of the United States, quoting Restatement (Third) of Foreign Relations Law, §403(2)(a), by depriving U.S. citizens of employment opportunities; (2) the German courts were unlikely to seek to assert jurisdiction over the dispute in light of Pan Am's status as an American carrier; and (3) the parties "undeniably anticipated that the collective bargaining agreement would apply to international flights," and hence expected that enforcement would be determined by reference to U.S. law. 923 F.2d at 686. In the dissent's view, "[t]he court has a responsibility to act in the face of an alleged breach that might cause serious injury, for 'collective bargaining agreements are central to American labor law and are the essential threads of its fabric.'" Id. (quoting Air Line Pilots Ass'n v. TACA International Airlines, S.A., 748 F.2d 965, 968 (5th Cir. 1984), cert. denied, 417 U.S. 1100 (1985), a decision addressed below).
Subsequent to the Berlin Express decision, several other cases were filed that would have afforded an opportunity for further judicial guidance as to the applicability of the non-extraterritorial presumption in an airline industry context. The Association of Flight Attendants ("AFA") initiated litigation against Tower Air contending that Tower's foreign-based flight attendants were entitled to the protections of U.S. labor law; ALPA similarly challenged Federal Express' position that the RLA did not apply to a pilot domicile established at Subic Bay and that ALPA's certification as bargaining representative did not extend to such pilots, and ALPA instituted litigation with a similar objective when Atlas Air initiated action to establish an alter ego operation at Stansted Airport in the United Kingdom and took the position that the pilots who would be based there would not be subject to the RLA and that the carrier would not negotiate with ALPA, the bargaining representative of the Atlas pilots, with respect to the terms and conditions of employment applicable to pilots based at Stansted. These cases were settled before the courts determined the significant issues presented. n10 
n10 Examples of more recent decisions addressing the non-extraterritorial presumption are Ofori-Tenkorang v. American Intern. Group, Inc., 460 F.3d 296 (2d Cir. 2006) (42 U.S.C. §1981 does not apply to acts committed while employee is outside the U.S., but could apply if employee established that he/she was discriminated against in the terms of the formation and modification of an employment contract before the individual left the U.S. to begin foreign assignment and employer took steps to implement this discriminatory conduct while the employee was still in the U.S.); Carnero v. Boston Scientific Corp., 433 F.3d. 1 (1st Cir. 2006) (Sarbanes-Oxley Act of 2002, 18 U.S.C. §1514A, does not apply extraterritorially to foreign worker employed outside the United States by foreign subsidiary of an American corporation), cert. denied, 126 S.Ct. 2973 (2006); Shekoyan v. Sibley International, 409 F.3d 414 (D.C. Cir. 2005); Reyes-Gaona v. N.C. Growers Ass'n, Inc., 250 F.3d 861 (4th Cir. 2001); United States v. Corey, 232 F.3d 1166 (9th Cir. 2000); Nieman v. Dryclean U.S.A. Franchise Co., 178 F.3d 1126 (11th Cir. 1999), cert. denied, 120 S.Ct. 938 (2000); Torrico v. International Business Machines Corp., 213 F.Supp.2d 390 (S.D.N.Y. 2002).
 
C. The "Effects Test" and the "Conduct Test"
Precedents established in court decisions outside the labor arena have avoided the consequences of a rigid application of the non-extraterritoriality presumption in finding U.S. laws applicable to activities occurring outside the U.S. through use of the "effects" and "conduct" tests.
Under the effects test, a U.S. law will be considered applicable to "foreign" conduct (i.e., to conduct occurring outside the U.S.) where that conduct has a "substantial, direct, and foreseeable effect upon or in the territory" of the United States. Restatement (Third) of Foreign Relations Law of the United States, §403(2)(a). n11 
n11 As previously noted, this same Restatement provision was cited as a basis for finding jurisdiction in the dissenting opinion in Berlin Express.
 
The conduct test focuses on whether conduct within the United States played a part in the accomplishment of illegal activities occurring outside the United States. Restatement (Third) of Foreign Relations Law of the United States, § 402.
 
1. Application of the Effects and Conduct Tests in a Non-Labor Law Context
The effects standard has long been applied in determining whether U.S. laws regulating commercial activities are applicable in particular circumstances involving foreign conduct. For example, courts have held that where anti-competitive activity occurring outside the U.S. has substantial and intended consequences within the U.S., it may form the basis for a viable claim under the U.S. antitrust laws. n12 The effects test also has been applied to extend the jurisdiction of U.S. courts to reach conduct occurring outside the United States under the Commodity Exchange Act, n13 the Securities and Exchange Act, n14 the Lanham Act, n15 and the RICO Act. n16 
n12 Hartford Fire Ins. Co. v. California, 509 U.S. 764, 796-97 (1993); United States v. Nippon Paper Industries Co., Ltd., 109 F.3d 1, 3-4 (1st Cir. 1997); U.S. v. Aluminum Co. of America, 148 F.2d 416, 443-45 (2d Cir. 1945); see Matsushita Elec. Industrial Co. v. Zenith Radio Corp., 475 U.S. 574, 582 n.6 (1986). But see Hartford Fire Ins., 509 U.S. at 814 (Scalia, J., dissenting in part) (noting the absence of legislative history evincing congressional intent to apply the antitrust laws to conduct outside the United States).
n13 Tamari v. Bache & Co., 730 F.2d 1103 (7th Cir.), cert. denied, 469 U.S. 871 (1984).
n14 Alfadda v. Fenn, 935 F.2d 475 (2d Cir.), cert. denied, 502 U.S. 1005 (1991).
n15 Steele v. Bulova Watch Co., 344 U.S. 280 (1952).
n16 Alfadda v. Fenn; DOE I v. Unocal Corp., 395 F.2d 932, 961 (9th Cir. 2002); South African Apartheid Litigation, 346 F.Supp.2d 538 (S.D.N.Y. 2004); see South African Apartheid Litigation, 346 F.Supp.2d 538, 555-56 (S.D.N.Y. 2004) (determination whether RICO applies in particular case to extraterritorial activity should be based on conduct and effects tests); United States v. Philip Morris USA, Inc., 449 F.Supp.2d 1, 872-73 (D.D.C. 2006) (same); see also DOE I v. State of Israel, 400 F.Supp.2d 86,115 (D.D.C. 2005) (relying on general purposes of RICO statute as indicative of intent to apply extraterritorially); United States v. Noreiga, 746 F.Supp. 1506 (S.D. Fla. 1990) (same); but see Jose v. M/V Fir Grove, 801 F.Supp. 349, 357(D.Or. 1991) (finding no Congressional intent to apply RICO extraterritorially).
 
An example of the application of the conduct test is found in Tamari v. Bache & Co., supra, where U.S. jurisdiction was found to extend to a dispute between foreign parties over a commodity futures contract entered into outside the United States that subsequently was traded on United States commodity exchanges. The fact that all contacts between the parties to the contract took place outside the U.S. was insufficient to negate the reach of American law. The activity on the commodity exchanges, while not itself illegal, furthered the illegal activity committed abroad and thus permitted the application of U.S. law. 730 F.2d at 1106-09.
Steele v. Bulova Watch Co., supra, presents another instance in which the Court, although not formally invoking the conduct test terminology, held U.S. law to apply because the illegal scheme included certain conduct within the United States. There, a U.S. citizen manufactured watches in Mexico and then applied the "Bulova" name to the watches without permission. The only U.S. nexus, besides the American citizenship of the parties, was the fact that certain parts used in manufacturing the watches came from the U.S. and certain individuals who purchased the watches in Mexico thereafter brought the watches with them when they returned to the United States. The Court held even though this limited activity within the U.S. was perfectly lawful in and of itself, it was sufficient to permit the application of U.S. law because the U.S. activity formed part of the foreign trademark infringement scheme. 344 U.S. at 287. n17 
n17 See also Alfadda v. Fenn, supra (Securities and Exchange Act and RICO Act applicable to claim by foreign investor-purchasers of interests in a foreign corporation where the investors' stake was fraudulently diluted by sales to others in the United States, even though the U.S. sales, in and of themselves, may not have been illegal); Grunenthal GmbH v. Hotz, 712 F.2d 421 (9th Cir. 1983) (federal securities laws applicable to transaction in foreign securities between foreign corporations and citizens of foreign states where certain, limited conduct in fraudulent scheme took place in the U.S.); SEC v. Kasser, 548 F.2d 109 (3d Cir.) (federal securities laws applicable in action based on alleged scheme to defraud foreign corporation, where certain conduct in furtherance of scheme took place in the U.S., even though the scheme had no effect in the U.S.), cert. denied sub nom. Churchill Forest Industries (Manitoba), Ltd. v. SEC, 431 U.S. 938 (1977). A more significant domestic U.S. connection is now required in an antitrust context involving non-import foreign commerce, where, under the Foreign Trade Antitrust Improvements Act, 15 U.S.C. §6(a), U.S. law will be held applicable only in situations involving foreign conduct that has a "direct, substantial, and reasonably foreseeable effect" on U.S. domestic commerce and "such effect gives rise to a claim under" the U.S. antitrust laws. See, eg., F. Hoffman-La Roche Ltd. v. Empagran S.A., 542 U.S. 155 (2004) (holding that U.S. antitrust laws would not apply in an action brought by foreign individuals or entities challenging alleged anticompetitive conduct that occurred in significant part outside the United States and who claim to have been injured only outside the U.S., even if others who are not parties to the suit may have been injured by such conduct in the United States.

2. Application of the Effects and Conduct Tests in a Labor Law Context
In a number of cases arising in a labor law context, courts also have focused on the extent to which conduct at issue impacted or occurred within the United States. These decisions have, in substance if not by name, applied the effects and conduct tests.
NLRA Cases
One example of what was essentially an application of the effects and conducts tests is found in a series of decisions that addressed actions that occurred in Japan that were related to a labor dispute in the United States. The International Longshoremen's Association ("ILA") sought to require the exclusive use of union dockworkers to load goods intended for export on ships docked in Florida. The ILA requested its counterpart in Japan to pressure Japanese importers not to import goods from the U.S. that arrived on ships that had been loaded in the U.S. by non-union labor. As a result of the actions of Japanese unions, Japanese importers restricted their imports to goods that had been boarded in the U.S. by union workers. The affected American exporters filed charges with the NLRB claiming that the ILA had engaged in unlawful secondary activity.
While the NLRB and the courts differed on the merits of the underlying issues in this dispute involving conduct in Japan, all tribunals that addressed the issue concluded that NLRA jurisdiction properly extended to the action in question because the conduct, notwithstanding its foreign locale, was intended to and in fact had substantial effects within the U.S. and pertained to other conduct within the U.S. -- namely, the ongoing labor dispute between the U.S. unions and employers that lay at the center of the controversy. n18 
n18 Dowd v. International Longshoremen's Ass'n, 975 F.2d 779, 789-91 (11th Cir. 1992) (on NLRB application for injunction), International Longshoremen's Ass'n, 313 NLRB 412, 416-18 (1993) (decision on merits), enforcement denied on other grounds, International Longshoremen's Ass'n v. N.L.R.B., 56 F.3d 205 (D.C. Cir. 1995 (not addressing jurisdictional issue), cert. denied sub. nom Canaveral Port Authority v. Int'l Longshoremen's Ass'n, 516 U.S. 1158 (1996). On remand from the D.C. Circuit, the NLRB dismissed the case. International Longshoremen's Ass'n, 323 NLRB 1029 (1997). While the NLRB majority did not address the jurisdictional issue, then Chairman Gould, in dissent, agreed with the Board's 1993 determination that the foreign conduct in question properly fell within the NLRB's jurisdiction. Id. at 1034-36 (Gould, dissenting). See also Torrico v. International Business Machines Corp., 213 F.Supp.2d 390, 399 (S.D.N.Y. 2002) (court noting with regard to an Americans with Disability Act claim that the presumption against extraterritoriality ordinarily does not apply where conduct in a foreign setting will result in adverse effects within U.S. or where the conduct occurs within the U.S.).
 
Another potential opportunity to determine the reach of U.S. labor law in disputes with foreign components arose in the context of a recent dispute involving Trico, a significant U.S. shipper operating in the Gulf of Mexico and also around the globe through worldwide affiliates. The U.S. unions that were trying to organize Trico's U.S.-based employees enlisted the assistance of the unions that represented mariners outside the U.S., including those employed by overseas Trico affiliates. Various types of boycott activities were conducted against Trico affiliates outside the United States. The U.S. unions filed an unfair labor practice charge with the NLRB against Trico in the U.S. and, together with the International Transport Federation ("ITF"), filed a complaint against Trico with the Organization for Economic Commerce and Development ("OECD"). Litigation was commenced in Norway related to the threatened boycott of Trico by NOPEF, the union that represented Norway's mariners, in support of their American colleagues. A principal issue in this Norwegian litigation was whether U.S. or Norwegian law should govern disposition of the dispute, with Trico arguing that U.S. law controlled and the union taking the position that the dispute was to be resolved under Norwegian law. Trico filed its own NLRB charge in the U.S. against the U.S. unions involved in the dispute, and also commenced litigation in the United Kingdom against the ITF in response to the ITF's support for the U.S. unions' campaign against Trico. This situation clearly presented the prospect of interesting choice-of-law issues that was avoided only when the Norwegian and U.K. cases were settled, which rendered the pending NLRB proceedings in the U.S. moot.
U.S. labor law has also been held applicable to secondary boycotts by U.S. labor unions motivated by actions taken by foreign governments where the activity in question occurred in the U.S. and was directed against U.S. companies. n19 
n19 E.g., International Longshoremen's Ass'n v. Allied International, Inc., 456 U.S. 212 (1982) (NLRA extends to a refusal by U.S. union, in protest of the Soviet invasion of Afghanistan, to unload ships within the U.S. that were engaged in trade with the Soviet Union); International Longshoremen's Ass'n v. N.L.R.B., 723 F.2d 963, 965 (D.C. Cir. 1983).
 
RLA Cases
In an RLA context, certain courts, likewise, have focused on the interrelationship between conduct occurring outside the United States with conduct or effects occurring within or at least touching the United States, rather than on the non-extraterritorial presumption, to determine whether U.S. labor law is applicable.
One example is Local 553, Transport Workers Union v. Eastern Air Lines, 544 F.Supp. 1315 (E.D.N.Y.), aff'd as mod., 695 F.2d 668 (2d Cir. 1982)(referred to hereafter as the "Local 553" case). In the early 1980s, Eastern Airlines ("Eastern") purchased the South American routes of Braniff Airlines ("Braniff"). The "scope" clause of Eastern's CBA with TWU, the bargaining representative for its flight attendants, required that all Eastern flying be assigned to flight attendants on the Eastern seniority list. However, Eastern claimed that it would lose its right to operate in various South American countries unless it used the "foreign nationals" whom Braniff had employed on such routes, and therefore refused to assign the flying to TWU-represented flight attendants. TWU claimed that Eastern was attempting to unilaterally change the CBA in violation of the RLA. Eastern countered that the RLA did not apply outside the U.S., and that the dispute was a "minor" RLA dispute since the scope clause arguably did not apply to the South American operations. 544 F.Supp. at 1317-18, 1322-27. n20 
n20 Under the RLA, a distinction is drawn between "major disputes," that involve changes in collective bargaining agreements or established terms and conditions of employment, and "minor disputes," that center on questions of contract interpretation or application. Elgin, J. & E. Ry. v. Burley, 325 U.S. 711, 723-25 (1945). Federal courts have jurisdiction over major disputes and can issue injunctions requiring the parties to adhere to the mandatory bargaining procedures of the RLA before instituting self-help (e.g., strikes or unilateral changes in employment terms). Detroit & T. Shore Line R.R. v. United Transp. Union, 396 U.S. 142 (1969). Federal courts generally lack jurisdiction over minor disputes, that, instead, are to be adjudicated through the grievance/arbitration machinery. Consolidated Rail Corp. v. Railway Labor Executives' Ass'n., 491 U.S. 299, 302-04(1989).
 
The District Court in Local 553 found the dispute to be a "major dispute" under the RLA, and therefore enjoinable, because the all-encompassing scope language made any argument that the CBA was implicitly limited to U.S.-based employees "wholly-insubstantial." Id. at 1323. More pertinent to the international issues addressed herein, the Court held that the RLA was applicable because, unlike in other prior extraterritorial cases where wholly-foreign flying was at issue, the flying in question was primarily "between foreign points and points within the United States." Id. at 1322 n.1. In language seemingly conflicting with the previously-noted view of the majority in the Berlin Express case, the Court concluded that injunctive relief was appropriate even if the RLA did not apply, because "parties to an agreement made pursuant to the RLA may, by agreement, place conditions on the company's hiring of employees that may not be required by the RLA itself." Id. at 1326.
Similar issues were presented and yielded similar results in litigation in the United Kingdom, when a British Court was called upon to determine whether a contractual-based dispute in the context of an acquisition by United Air Lines ("United") of Pan Am's London routes should be governed by U.S. labor law or British labor law principles. Gately v. United Air Lines, CH 1991 G No. 2740 (High Court of Justice, Chancery Division). As part of the transaction, United agreed to hire a "reasonable number" of Pan Am pilots and flight attendants, subject to terms agreed upon by the unions for United's pilots (ALPA) and flight attendants (AFA). The Pan Am flight attendants were represented by IUFA, the same union involved in the Berlin Express case.
United offered employment to some but not all of the individuals who had been employed as flight attendants at Pan Am's London domicile. United informed those to whom it extended employment offers that the terms of the United-AFA CBA would govern their employment and that, only if AFA consented, would the hired flight attendants receive seniority credit at United for their service at Pan Am.
Both those who were hired and those who were not sued United in London, claiming that, under a British statute known as the Transfer of Undertakings Act, United was obligated to hire all the former Pan Am flight attendants based in London and to grant them terms and conditions, including seniority, no less favorable than they enjoyed at Pan Am, i.e., at minimum, the terms provided under the Pan Am-IUFA CBA.
United and AFA contended that the RLA rather than British law was applicable because of the superior U.S. ties to the litigation -- United was a U.S. carrier, both AFA and IUFA were U.S. unions, the United-UFA collective bargaining agreement had been negotiated in the U.S. under U.S. law, and the bulk of the flying was between the United Kingdom and the United States and not "wholly foreign" -- and because United would violate the RLA if it unilaterally changed terms and conditions of employment mandated by the United-AFA CBA.
IUFA, which funded the plaintiffs' litigation and intervened on their side, took precisely the opposite position in Gately from that which it had pursued in the Berlin Express case; it argued that the RLA did not apply because it did not extend extraterritorially to United's operations in London or to British-based employees.
The British Court denied the plaintiffs' request for the equivalent of a preliminary injunction, concluding that the plaintiffs had not demonstrated that they were likely to establish that the British statute applied and that the balance of hardships tipped in defendants' favor. Interestingly, the latter conclusion was based upon the British Court's assessment that United was likely to be enjoined in the United States if United, without AFA's concurrence, provided the terms and conditions sought by plaintiffs in response to the British Court's issuance of an injunction. The Court considered this result compelled by Local 553 (reviewed above), the only case the Court considered to be directly on point. n21 The British Court did not find the fact that the flight attendants in question were based in the United Kingdom to be determinative. n22 The British lawsuit was discontinued shortly after the Court denied the injunction. n23 
n21 As noted above, the dissenting opinion in the Berlin Express case would have found the RLA applicable to the activity at issue conducted outside the U.S. based on application of the effects test. 923 F.2d at 686 (Nelson, J., dissenting).
 
n22 Section 9.209 of the NMB's Representation Manual (2005) provides that: "Only employees based within the United States and/or its possessions are eligible," referring to eligibility to vote in representation elections. See Express One International, Inc., 25 NMB 383, 387 (1998); Petroleum Helicopters, Inc., 27 NMB 283, 287 (2000), 32 NMB 179 (2005); Offshore Logistics Aviation Servs., 11 NMB 144 (1984). The NMB has determined that employees based in the U.S. are eligible to vote even if much of their work occurs outside the U.S. Atlas Air, Inc., 25 NMB 181, 183 (1998). Interestingly, the language currently in the Representation Manual replaces language in earlier versions of the Manual which stated that only U.S.-based employees are "subject to Railway Labor Act jurisdiction," see, e.g., Section 5.310 of the 2001 Manual. The foundation for the earlier formulation was questionable because it purported to extend beyond the confines of Section 2 Ninth of the RLA, and thus into areas in which the NMB's pronouncements are entitled to no special deference. See Railway Labor Exec. Ass'n v. NMB, 29 F.3d 655, 659, 662-63, 671 (D.C. Cir. 1994) (en banc), cert. denied sub. nom National Railway Lab. Conf. v. Railway Labor Exec. Ass'n, 514 U.S. 1032 (1995); ILA v. N.C. Port Auth., 463 F.2d 1, 3 (4th Cir.), cert. denied, 409 U.S. 982 (1972); United States v. Feaster, 410 F.2d 1354, 1361 (5th Cir.), cert. denied, 396 U.S. 962 (1969); Pan Am World Airways v. United Bhd of Carpenters, 324 F.2d 217, 222-23 & n.2 (9th Cir. 1963), cert. denied, 376 U.S. 964 (1964); cf. United Transp. Union v. United States, 987 F.2d 784, 789, 790 n.4 (D.C. Cir. 1993) (explicitly reserving issue of whether deference due NMB exercise of "jurisdiction based on its interpretation of the [RLA]").
It should also be noted that the NMB has not strictly adhered to its own stated policy. Indeed, when the NMB, prior to the Gately litigation, conducted a representation election among the Pan Am flight attendants in response to a petition filed by IUFA, the Board permitted the carrier's flight attendants who were based in London to vote.
n23 For a more detailed discussed of case law addressing the determination of applicable law in the context of international disputes and related issues, see Stephen B. Moldof, The Application of U.S. Labor Law to Activities and Employees Outside the United States, 17 Lab. Law 417 (Winter/Spring 2002); International Labor and Employment Laws, Vol. I, 2d ed. (BNA 2003, William J. Keller, ed.), chapter on Extraterritorial Application of U.S. Law, Part II - Collective Bargaining at 50-35 and 2006 Supplement at 50-32 (Stephen B. Moldof and Joseph Z. Fleming).
 
D. Additional Variants: The Foreign Compulsion and Act of State Doctrines
The previously-discussed Local 553 decision also addressed consideration of what is commonly referred to as the "foreign compulsion" defense -- a claim that a defendant's allegedly unlawful conduct is "involuntary" in the sense that it is "compelled" by the foreign law of the country in which the defendant is operating.
In deciding whether to permit a "foreign compulsion" defense, a court is to balance the following factors:
(a) vital national interests of each of the states,
(b) the extent and nature of the hardship that inconsistent enforcement actions would impose upon the person,
(c) the extent to which the required conduct is to take place in the territory of the other state,
(d) the nationality of the person, and
(e) the extent to which enforcement by either state can reasonably be expected to achieve compliance with the rule prescribed by that state.

ALPA v. TACA, 748 F.2d at 971-72 (quoting Restatement (Second), The Foreign Relations Law of the United States, §40). See Restatement (Third), The Foreign Relations Law of the United States, §§403, 441.
The Court in Local 553 did not specifically review these factors, but nevertheless rejected the "foreign compulsion" defense advanced by Eastern, because "[e]ven assuming that ... the laws and political reactions of these [South American] countries to any change in the employment status of the [foreign] Braniff flight attendants" were as Eastern contended, Eastern was bound to follow the terms of the TWU CBA, for it was Eastern, not the Union, that "voluntarily decided to take over" the foreign routes. 544 F.Supp. at 1335. In the court's view, "a carrier should not be able to avoid its RLA obligations based upon foreign law where it has voluntarily put itself in a situation where it knew those laws would be applicable." Id. at 1336. n24 See Steele v. Bulova Watch, supra, 344 U.S. at 288 (defendant that, by its own acts, brought about forbidden results, cannot avoid liability for Lanham Act violation based on foreign government's registration of trademark).
n24 The decision of the Second Circuit in Local 553 did not specifically address either the extraterritorial or foreign compulsion issues.
 
A more explicit discussion of the foreign compulsion defense as well as of a doctrine known as the "act of state" is found in ALPA v. TACA. At the time the litigation arose, TACA was the national airline of El Salvador. A majority of TACA's pilots were Salvadoran nationals, but all were based in New Orleans, represented by ALPA and covered under a TACA-ALPA collective bargaining agreement.
In the midst of negotiations between TACA and ALPA for a new CBA, the Constitution of El Salvador was amended to require all public service companies to have their work center and base of operations in El Salvador. Immediately thereafter, the Salvadoran government ordered TACA to relocate its pilot base to El Salvador. TACA announced that it would comply, abrogate the TACA-ALPA CBA, and withdraw recognition from ALPA. ALPA sued in Federal Court in New Orleans, contending that TACA's announced course of action was a unilateral change prohibited by the RLA. n25 In response, TACA claimed that: as a Salvadoran company, it had to comply with the Constitutional directive or it would lose its operating certificate; its actions were authorized by an Air Transportation Agreement between the U.S. and El Salvador; and, under the act of state doctrine, the United States courts should defer to the requirements of Salvadoran law and not grant injunctive relief. TACA's position was supported by the government of El Salvador, which appeared as an amicus in proceedings before the Fifth Circuit. Id., 748 F.2d at 967. 
n25 A similar effort by TACA to leave the U.S. in 1969 had been enjoined, Ruby v. TACA International Airlines, S.A., 439 F.2d 1359 (5th Cir. 1969). In that instance, the alleged Salvadoran government directive to TACA was less explicit.
 
Under the act of state doctrine, U.S. courts will not question the validity or motivations of actions of foreign governments within their own borders, n26 the purpose being to avoid conflicts between governments and judicial interference with the role of the executive branch in international affairs. ALPA v. TACA, 748 F.2d at 970. Among the factors to be considered in determining whether the doctrine applies are: the degree of involvement of the foreign state; the effect a judicial decision would have on foreign relations; and whether the decision will involve the adjudication of the laws, conduct or motivation of a foreign government. A critical factor is the location of the interest (or "res") to which the attempted action in question would apply; where "the res is outside the control or territory of the foreign state, the doctrine need not apply." Id.
n26 E.g., Banco Nacional de Cuba v. Sabbatino, 376 U.S. 398 (1964); Hunt v. Mobil Oil Corp., 550 F.2d 68 (2d Cir.), cert. denied, 434 U.S. 984 (1977); see W.S. Kirkpatrick & Co. v. Environmental Tectonics Corp., Int'l., 493 U.S. 400 (1990).
 
The court rejected TACA's reliance on the Air Transportation Agreement, holding that it was not intended to replace relevant domestic labor law. Next, the court held that the act of state doctrine inapplicable because: (1) the court was not adjudicating the validity of Salvador's Constitution, but rather the legality of TACA's response to the Salvadoran governmental directive, which, "[i]nsofar as the relationship between TACA and ALPA ... must be made in a manner consistent with controlling provisions of United States law, specifically and primarily the Railway Labor Act," id. at 971; (2) the TACA-ALP A dispute did not involve sensitive areas of international relations; and (3) "the res or interest in this case, whether we deem it the pilot base or the collective bargaining agreement, is clearly located in the United States." Id. Thus, the Court concluded:
 
We cannot give effect to El Salvador's directive to TACA to extinguish ex parte the collective bargaining agreement and relocate the pilot base. Those acts directly affect interests located within the United States and contravene fundamental principals of American labor policy.
 
Id. One such "fundamental principle" was that "collective bargaining agreements are a cornerstone of our national labor policy." Id. at 972. n27 
n27 Cf.,. Joint Application of Alitalia-Linee Aeree Italiane-S.p.A, et. al., Docket OST-2004-19214, Order 2005-12-12, at 33 (DOT 2005) (similarly recognizing that the antitrust laws also have been recognized as representing a "fundamental national economic policy"). However, despite this parallel recognition of the significance of antitrust and labor law, courts have applied a different analytical analysis in determining whether these two "fundamental" sets of statutes shall be construed as applying extraterritorially, as reviewed above.
For an interesting recent discussion of the Act of State doctrine, see Sarei v. Rio Tinto, Plc, 487 F.3d 1193, 1208-10 (9th Cir. 2007).
 
In analyzing TACA's attempt to justify its actions as resulting from "foreign compulsion," the Fifth Circuit in ALPA v. TACA, like the court in Local 553, placed heavy emphasis on the fact that TACA voluntarily had chosen to conduct business in the United States. By doing so, the court reasoned, TACA became "subject to all relevant domestic [U.S.] laws," ALPA v. TACA, 748 F.2d at 972, and its actions could not be excused on foreign compulsion grounds. Id. at 971-72. The court held that TACA could relocate its base only by following the procedures of the RLA, i.e., by negotiating an agreement with ALPA, or by exhausting the RLA's bargaining procedures, obtaining a "release," and then lawfully implementing "self-help." See id. n28 
n28 As previously noted, Congress amended Title VII of the Civil Rights Act in 1991 to provide for extraterritorial application of the statute. The amendment specifically incorporates a foreign compulsion defense, applicable where statutory compliance with respect to an employee in a foreign workplace would "cause" the employer to "violate the law of the foreign country in which such workplace is located." Section 702(b), 42 U.S.C. 2000e-1(b)(1991). The EEOC's Guidelines on the amendment confirm that the burden is on the employer to demonstrate all elements of the defense, including, inter alia, a showing that there is an "inevitable" conflict between statutory compliance and foreign law. The Guidelines further emphasize that foreign court decisions do not constitute "foreign law" for purposes of the foreign compulsion defense. EEOC Enforcement Guidance on Application of Title VII and the ADA to Conduct Overseas and to Foreign Employers Discriminating in the U.S., N-915.002 (Oct. 20, 1993), 8 FEP Manual (BNA) 405:6663 at 405:6668-69 and n.10 (1993). See also Americans with Disabilities Act, 42 U.S.C. §12112(c) (ADA foreign compulsion defense provision).
 
An attempted use of the foreign compulsion defense also was rejected in Association of Flight Attendants v. United Airlines, 797 F.Supp. 1115 (E.D.N.Y.), rev'd on other grounds, 976 F.2d 102 (2d Cir. 1992), unreported decision following trial, CV-92-2919 (E.D.N.Y. Nov. 19, 1993). That case arose after United had announced the opening of a flight attendant domicile in Paris, France. The applicable CBA required that vacancies in new domiciles be filled through a bidding process by seniority, and precluded the use of new hires unless there were insufficient bids from incumbent flight attendants.
Flight attendants who were not citizens of the European Economic Community purportedly needed visas to be able to work at the Paris base. Although the domicile was slated to open with 225 flight attendants, United made arrangements with the French government for only 75 visas. Many more incumbents bid for the vacancies than there were openings, but United permitted only the 75 most senior non-EEC citizens to transfer, for whom visas were available, and filled the remainder of the positions either with incumbents who held EEC citizenship (almost all of whom, had seniority governed, would not have been awarded the positions), or with new hires who were EEC citizens. United claimed that incumbents without visas were "not qualified" for the Paris positions. The flight attendants' union (AFA) claimed that the insufficiency of visas could not excuse United's filling of vacancies out-of-seniority order and that the CBA obligated United to arrange for the necessary number of visas.
The District Court initially granted a preliminary injunction and barred United from opening the Paris domicile until visas could be obtained for senior incumbents desiring to fill the openings. n29 The Appellate Court reversed, not on the merits, but because it concluded that United's contractual position was "arguably justified" by the CBA and therefore presented a "minor dispute" under the RLA within the exclusive jurisdiction of the arbitration board. n30 After the federal court litigation had concluded, the parties engaged in a lengthy arbitration that resulted in a decision finding that United had violated the CBA by seeking an insufficient number of visas. The System Board formulated a remedy that requires union participation in future situations involving a need to obtain immigration approvals for flight attendants.
n29 In the view of the District Court in AFA v. United, United had manipulated the visa requirement in a bad faith attempt to avoid the seniority requirements of the CBA and to get around the CBA's limitation on the number of flight attendant positions that United was permitted to set aside for foreign language-speaking flight attendants.
 
n30 Because the appellate ruling in AFA v. United had been based only on a pre-discovery, preliminary injunction record, the District Court, over United's objection, ordered an expedited trial to determine, with benefit of a full record, whether the matter involved a major dispute (as to which the Court would have jurisdiction and could order necessary relief) or a minor dispute within the exclusive province of the system board of adjustment (the arbitration tribunal). The District Court eventually determined that the case presented a minor dispute to be determined on the merits by the system board. CV-92-2919 (E.D.N.Y. Nov. 19, 1993).
 
United, as part of its legal defense in the federal court litigation, asserted the equivalent of a foreign compulsion defense, arguing that any non-compliance with the CBA could be excused under the "savings clause" of the CBA because United's actions were required by French immigration law. The district court rejected the carrier's position, finding no factual basis for the contention that United's actions were required by French immigration law. 797 F.Supp. at 1123. Additionally, the court considered United's argument to be flawed as a matter of law because United was aware of the impact of French immigration law before it embarked upon its course of conduct:
 
Ten years later [after the Local 553 case, which had been decided by the same Judge] it remains true that 'a carrier should not be able to avoid its RLA obligations based upon foreign law where it knew those laws would be applicable' (quoting Local 553, 544 F.Supp. at 1336). Like the common law of coming to a nuisance, this rule prevents the instigator of trouble from calling itself the victim.
 
Id. at 1123-24.
The Court of Appeals in AFA v. United did not address the "foreign compulsion" issue. The District Court, in its subsequent post-trial decision, again rejected United's foreign compulsion defense: "...United's argument that the CBA's savings clause relieves it of its obligations under the seniority provisions of the CBA because those obligations would require it to violate French law remains, in the [District Court's] view, frivolous." Slip Op., p. 14. n31 
n31 United did not, in AFA v. United, argue that the Court lacked jurisdiction, under the non-extraterritorial presumption, to provide the relief requested by AFA, no doubt, at least in part, because it had argued vigorously in Gately that the RLA and the United-AFA CBA, not British law, governed United's London operations and the London-based flight attendants, and because it had publicly announced that the United-AFA CBA and the RLA would apply to the Paris domicile.
 
United again was rebuffed in its attempt to rely upon inconsistencies in U.S. and foreign law in litigation in the United Kingdom involving the rights of its London-based flight attendants to continued employment and income while they were pregnant.
The United-AFA CBA, consistent with an earlier consent decree entered by a U.S. District Court arising out of litigation between United and AFA, provided that pregnant flight attendants may continue flying through the first 27 weeks of pregnancy (subject to certain medical verifications). London-based United flight attendants argued that, under U.K. law, flight attendants could not be grounded involuntarily after 27 weeks, but must instead be permitted to continue to fly if able, offered alternative employment if no longer able to fly, or, if no alternative jobs were available, placed on a paid leave. United argued that it was subject to U.S. law, with which its conduct was consistent, and was not bound by any inconsistent obligations imposed by British law. The Employment Tribunal disagreed and ordered United to comply with British law. Bannigan, et.al. v. United Airlines, Case No. 10471/96, 21107/96,20119/96 (Employment Tribunals 1999).
The British Tribunal in Bannigan, like the U.S. Courts in Local 553, TACA and AFA v. United, relied heavily on the fact that United had elected to do business in the United Kingdom for its conclusion that United therefore should not be able to insulate itself from the requirements of British law:
 
We find that the Respondent [United], in other areas of the globe where they operated, have applied local legislation. There is no reason why employees who are deemed to be employees working in the United Kingdom should not have United Kingdom legislation applied to them.

Decision of The Employment Tribunals, p. 5.* It should further be noted that, in contrast to the situation presented in Gately, where the attempted application of British law would have had severe adverse consequences for the rest of the United flight attendants who were based in the U.S., an application of maternity benefits to British-based flight attendants that were more generous than those provided under U.S. law, as required in Bannigan, involved only non-competitive employment terms and would not have caused any harm to the U.S.-based flight attendants.
 
II. Some Conclusions, Observations and Suggestions
A. Taking Account of the Airline Industry of Today
The airline industry that exists today differs in many respects from that which existed before the rapid international expansion of flying involving U.S. carriers in the last 15 years. In light of these changes, we offer the following for consideration.
1. There no longer is any basis (if there ever was one) for courts, in situations where foreign conduct is involved, to apply one set of principles in determining whether U.S. labor laws apply and a different, inconsistent set of principles in determining the applicability of U.S. laws involving matters outside labor and employment law.
The cases applying the non-extraterritorial presumption instruct that the language of a U.S. statute and congressional intent pertaining to such legislation are the lynchpins for determining whether a particular U.S. statute is applicable to extraterritorial conduct. If that is the case, there is no reasoned basis for concluding that U.S. laws other than labor laws should apply to foreign conduct but that U.S. labor laws should not; indeed, the arguments in favor of applying the RLA in such situations would appear to be far stronger than those for applying many of these other U.S. statutes.
From the outset of the airline industry, and even before the RLA was extended to apply to airlines, U.S. carriers operated internationally and based employees overseas. This included conducting flights from one foreign location to another, as well as the carriage of U.S. mail overseas. Nothing in the RLA's legislative history indicates that Congress intended to exclude from RLA coverage the significant segment of the U.S. airline industry that, at the time, was operating internationally or the employees who were manning such flights.
Courts have found U.S. non-labor statutes applicable to disputes involving foreign conduct notwithstanding the absence of any indication in the language or legislative history of the statutes in question that Congress intended their applicability to conduct outside the United States. See Hartford Fire Ins., 509 U.S. at 814 (Scalia, J., dissenting in part) (noting the absence of legislative history evincing Congressional intent to apply the antitrust laws to conduct outside the U.S.). These courts have been able to find U.S. commercial laws applicable extraterritorially only by fashioning and applying different principles than the non-extraterritorial presumption, and have not felt constrained by the principles underlying that presumption.
2. It would be far more in keeping with the reality of the current global economy to incorporate the effects and conduct tests, as heretofore applied in commercial contexts and more recently in certain labor disputes, into the determination of whether U.S. labor law properly applies to such disputes.
One no longer can realistically describe airline industry or airline employee activities as "wholly foreign" or as confined exclusively to foreign locales. As previously noted, many U.S. air carriers have entered into relationships or alliances with foreign carriers through which the carriers have coordinated significant aspects of their businesses. There also have been a proliferation of code-sharing arrangements between U.S. and foreign carriers. Under the code-share arrangements, international flights, or add-on segments to such flights, as a practical matter, are held out to the flying public as flights flown by a single carrier, when they actually are being flown in whole or in part by one or the other of the code-share partners (often depending on the direction of the international flight, e.g., whether it is from the United States to Europe or from Europe to the United States). A number of these relationships between U.S. and foreign carriers have been assisted substantially by the U.S. government through grants of antitrust immunity. n32 
n32 Among the many relationships or alliances that have been established are: the Star Alliance (including United, Lufthansa, US Airways, SAS, Thai, Air Canada, Air New Zealand, ANA, Bmi, Singapore, Austrian, Asiana, LOT, TAP Portugal, Spanair, South African, Swiss); One World (including American, British Airways, Cathay Pacific, Quantas, Finnair, Iberia, Lan, Japan Airlines, Malev, and Royal Jordanian); SkyTeam (Delta, Air France, Northwest, KLM, Continental, Alitalia, CSA Czech Airlines, Aeromexico, Korean, and Aeroflot); and many other combinations of carriers through codesharing and/or other relationships.
 
As a result of the developments in the airline industry, the lines between U.S. and foreign carriers truly have been blurred. Quite clearly, actions taken in the workplace in one nation can impact substantially the conduct of work in other nations. Legal precepts built on an assumed single-nation workplace no longer can be squared with economic or business reality. See Torrico v. International Business Machines Corp., 213 F.Supp.2d 390, 405-06 n.9 (S.D.N.Y. 2002); General Accounting Office Report, "Transatlantic Aviation: Effects of Easing Restrictions on U.S.-European Markets," GAO-04-835 at 33 (July 2004) ("in an industry in which the assets and employers are mobile, what constitutes an airline's principal place of business is uncertain").
These U.S.-foreign carrier relationships have significant implications for labor-management relations. For example, these arrangements may threaten vital employment protections embodied in scope clauses found in collective bargaining agreements that define which employees have "jurisdiction" over particular work. Issues over the allocation of flights among alliance partners have arisen and can be expected to increase and become more complex. Difficulties are particularly likely to arise where the alliance partners attempt to relocate work within an alliance from one nation to another, and especially where the work is being shifted from a higher-cost to a lower-cost workforce or to a nation that affords fewer social and economic benefits to employees.
Additional significant issues are likely to arise when the employees of one of the alliance parties are involved in a labor dispute, and especially where the dispute escalates into a strike. Management might very well react by shifting "alliance" flights away from the partner whose employees are engaged in the strike to other partners whose employees are not on strike. Were that to occur, the non-striking employees could find themselves assigned work that previously had been performed by the striking employees. In response, and in the exercise of self-interest, the employees of the alliance partners may likewise determine to join forces to resist such carrier efforts to whipsaw one employee group against another. Unsurprisingly, that is, in fact, what unionized employees of airline alliance partners have done, forming their own alliances in an effort to coordinate and protect their mutual interests and to defend against perceived threats posed by the joint activities of their employers.
It was precisely such concerns with resisting carrier efforts to pit employee groups against one another that led the pilots of Northwest Airlines and KLM to undertake mutual support activities, first, in 1997, when KLM was attempting to extract major concessions from the KLM pilots and later during the 1998 Northwest pilot strike. In both instances, the pilot group that was not directly involved in the dispute resolved to support the other pilot group by refusing to fly operations that could be characterized as "struck work" (e.g., extra sections of flights; flights on larger gauge aircraft; flights flown by the other pilot group before the onset of the dispute). Subsequently, the Northwest pilots resolved to lend support to the efforts of the Japan Air System ("JAS") pilots to resist efforts by Northwest partner carrier JAS to undermine labor conditions by creating what essentially was an alter ego operation.
Also illustrative of the significance of the issues posed by increased forays by airlines into international arenas, and of the fact that such endeavors transcend "national" lines, is the role that the opening of foreign flight attendant domiciles played at United Airlines in the 1990s. Apart from the previously discussed dispute arising out of the opening of the Paris flight attendant domicile, the issue played an important part in the effort of United employees to acquire majority ownership of United through an ESOP in the 1990s.
The flight attendants were the only union-represented group at United that elected not to participate in the ESOP transaction. Unquestionably, the principal reason the flight attendants decided not to join the ESOP and to agree to the corresponding concessions to their existing CBA that would be needed to establish the ESOP, was their inability to obtain satisfactory commitments from United limiting the continued maintenance and further expansion of foreign domiciles. In the flight attendants' view, United, by opening foreign domiciles, took choice jobs away from the United States and shifted them overseas, where they were filled largely by foreign new hires who, because they lack immigration status to work in the United States, were effectively locked-into the foreign domiciles.
Foreign domiciles remained a central issue in post-ESOP collective bargaining between United and AFA. In early 1996, the parties reached a tentative agreement that would have barred the Company from opening any additional foreign domiciles (at the time there were domiciles in London, Paris and Taipei) and capped the size of the existing domiciles. That agreement was narrowly rejected by the flight attendant membership. Thereafter, United opened additional domiciles in Hong Kong, Santiago, Frankfurt and Narita (Japan). The parties subsequently concluded another agreement, this time ratified by the membership, that provided that U.S.-based flight attendants would fly at least 60% of the international block hours flown by United.
Pilots also have addressed the issue of foreign domiciles at the bargaining table. ALPA successfully incorporated provisions prohibiting the opening of any foreign domiciles without ALPA consent in its contracts with several major carriers, or requiring that flight operations conducted from foreign domiciles be flown by pilots on the U.S. pilots' seniority list pilots under terms governed by ALPA collective bargaining agreements with U.S. carriers. Other provisions have provided that U.S. carriers will remain domestic air carriers subject to the RLA, will maintain their headquarters, executive offices and will base senior flight operations personnel in the U.S. The effort to obtain such prohibitions and protections was motivated, in part, by concerns generated by decisions such as Berlin Express. Foreign domiciles also were and continue to be an important issue in ALPA negotiations with Federal Express, and, in the past, in ALPA negotiations with Atlas Air and in AFA negotiations with Tower Air.
Other issues with international law implications that may surface in the future relate to the longstanding U.S. prohibition on cabotage by which non-U.S. certificated carriers are barred from carrying passengers or cargo between points within the United States. In anticipation of possible efforts to modify this prohibition, a number of ALP A pilot CBAs have incorporated express prohibitions on U.S. carriers having code share or other similar relationships with foreign carriers that engaged in cabotage flying, and carrier-union commitments to work together to oppose any change in the law that would permit cabotage.
The foregoing discussion highlights but a few examples of labor-management issues that may result as U.S. and foreign carriers further integrate their operations and financial fortunes and that, depending on their resolution, may have significant impact within the United States regardless of the geographic location at which the underlying conduct is purportedly based or from which it is allegedly conducted.
B. In Search of a Rational Approach
While rote application of general rules may often be the simplest way to deal with problems, it often produces illogical and inequitable results. This certainly is true if one attempts to apply allegedly fixed extraterritoriality "principles" without consideration of practical implications in particular settings, or if one fails to consider the "effects" of foreign activity within the United States.
Illustrative of such untenable consequences are decisions involving the airline industry (reviewed above) that focus on the geographic points served on particular flights, i.e., whether the flying is "wholly-foreign" or between the U.S. and a foreign point. This approach runs smack into the realities of how flying is conducted and assigned. A few examples may help to illustrate this point.
While flying assigned to United's Paris and London flight attendant domiciles, after their establishment, consisted primarily of flying to and from the United States, it also included wholly intra-European flying. How can one rationally conclude that the RLA should apply when these foreign-based flight attendants are flying to and from the U.S., but not on segments flown between European points?
At most carriers, the assignment of flying and of flight crews to a particular domicile varies as carriers shift flying among domiciles and employees exercise their right to utilize their seniority to transfer between domicile locations. Does the RLA coverage of these employees shift from month-to-month depending on the schedules their seniority permits them to hold or on their varying domicile locations? What happens if there is an excess of flight personnel at a U.S. domicile and the employees are involuntarily transferred overseas. Are they, as a result, stripped of their RLA protection? How can such consequences be considered rational?
What if the flying that a carrier assigns to a new foreign domicile consists totally or predominately of existing flying that had heretofore been flown by crews based in the United States, and that flying is integrally tied to the rest of the carrier's system? Can the carrier, by unilaterally shifting the flying to a foreign domicile, eliminate its obligations under the RLA or remove the statutory protections that the affected employees previously enjoyed?
There are important legal considerations that logically come into play as well. An approach such as that followed in Berlin Express, that essentially sanctions a "runaway shop," directly affronts the duty imposed by Section 2 First of the RLA, 45 U.S.C., §152 First, that carriers and unions "exert every reasonable effort to make and maintain agreements." See Chicago, N.W. Ry. v. United Transp. Union, 402 U.S. 570, 574, 579 (1971). Permitting such a result is particularly troublesome when the carrier continues to retain concessions it obtained from the union in exchange for the enhanced job protections that will be eviscerated if the carrier avoids its statutory and contractual obligations. Cf. Air Line Pilots Ass'n Int'l v. Pan Am World Airways, 765 F.2d 377, 379, 381-82 (2d Cir. 1985) (carrier required to implement certain wage increases and work rules that were "the quid pro quo for the Union's agreement to accept [certain] concessions"); Air Line Pilots Ass'n, Int'l v. Aloha Airlines, 126 L.R.R.M. (BNA) 2822, 2824 (D. Haw. 1987) (same); Association of Flight Attendants v. United Airlines, 71 F.3d 915 (D.C. Cir. 1995) (acquiring carrier in a combination of carriers required to arbitrate obligations to acquiring carrier's employees under scope clause, despite alleged representation dispute, where employees made substantial concessions to obtain the scope clause protections). It was precisely such a concern with the sanctity of collective bargaining agreements and with the statutory collective bargaining process that prompted the court in ALPA v. TACA to enjoin TACA's unilateral pilot relocation efforts from the U.S. to El Salvador, even though TACA was a foreign carrier and it arguably was "compelled" by a foreign government to relocate.
Similarly, automatic application of a rule that would bar foreign-based employees from voting in NMB representation elections, without consideration of the circumstances of a particular case, could have the effect of rewarding carriers for their unilateral efforts to escape RLA coverage -- a result at odds with Section 2 Third, Fourth and Ninth, 45 U.S.C. §152 Third, Fourth and Ninth, which, like other provisions of the RLA, are designed to strengthen and make more effective the collective bargaining process. See Switchmen's Union v. National Mediation Board, 320 U.S. 297, 302 (1943); Virginian Ry. v. System Fed. No. 40, 300 U.S. 515, 547-48 (1937).
It also seems abundantly clear that company actions occurring "wholly outside the U.S." can have "substantial and intended consequences" within the U.S. n33 For example, where a U.S. company establishes a foreign domicile and unilaterally purports to establish and apply different terms and conditions of employment to employees based abroad than those that govern U.S.-based employees in the same employment position, that has foreseeable consequences within the United States. Among other things, the employer, by unilaterally establishing such "two-tier" terms and conditions, and treating the union as a "non-entity" in the establishment of such terms, divides the employee group, impacts future negotiations, and undermines the union's status as exclusive representative.
n33 The very description of conduct as occurring "wholly outside the U.S." can be questioned. It is highly likely that significant "extraterritorial" action implemented by a U.S. company abroad has been conceived and developed at company headquarters in the United States. It is difficult to understand why such activity within the U.S. is of any less legal significance than the limited conduct within the U.S. that has been held sufficient to support application of U.S. antitrust or securities legislation to actions that occurred primarily outside the United States.
 
Consider, again, events that easily could develop as a result of the alliances between U.S. and foreign airlines. If the partners agree among themselves, without union input, on the allocation of "alliance flying," or to assist one another in the event of labor conflicts at one of the carriers, clearly this will have substantial consequences within the U.S. For example, if the foreign partner's efforts to reduce the wages and working conditions of its pilots ultimately result in a strike by its pilots and the U.S. partner steps in and flies certain of the flights that previously had been operated by the foreign partner, the U.S. carrier's actions, in all likelihood, will assist the foreign partner's negotiating position. Reductions in pay and working conditions of the foreign partner's pilots will create pressure on the U.S. pilots to reduce their wages and conditions to prevent a shift of flying from the U.S. partner to the foreign carrier that is able to operate them more cheaply due to the reductions it has managed to impose on its pilots.
To inject an additional practical consideration, disposition of the representational, contractual and legal issues presented by the expanded international activities of U.S. companies may not be solely dependent on determination of rights under U.S. law. Foreign countries in which employees are based or in which operations are being conducted may interpose their own concepts of representation or collective bargaining -- particularly as to their own "nationals" who are employed by U.S. carriers at foreign locations. These concepts may conflict with principals embodied in U.S. labor laws, even as fundamental as those that prescribe that there be a single, exclusive bargaining representative for a bargaining unit of employees (or "craft or class" under the RLA), Elgin, J & E Ry. Co. v. Burley, 325 U.S. 711, 728 (1945); or Brotherhood of Ry. and Steamship Clerks v. Florida East Coast Ry. Co., 384 U.S. 238, 246 (1966), or that employment terms be set by a single collective bargaining agreement. Order of R.R. Telegraphers v. Railway Express Agency, 321 U.S. 343, 347 (1944); see J.I. Case Co. v. NLRB, 321 U.S. 332, 375, 337-39 (1944) (same rules under the National Labor Relations Act). Fortunately, such potential conflicts were avoided in the previously-reviewed Gately v. United Airlines litigation in the United Kingdom, when the British Court relied upon the competing (and, in that court's view, the more significant) demands of the U.S. law to deny the injunctive relief sought by the plaintiffs (which, had it been granted, effectively would have offered continued representational status to the Pan Am flight attendants' union and have applied terms and conditions to a segment of the unit of employees that were inconsistent with those contained in United-AFA CBA). There is, of course, no guarantee that other foreign courts or governments will be similarly accommodating. n34 
n34 It is perhaps of interest in discussing how foreign courts are likely to approach issues regarding which nation's laws are applicable to note that U.S. tribunals have, at least in certain instances, held U.S. labor law to be applicable to the activities of foreign employers within the United States. Examples of decisions in which the NLRA was applied to individuals employed by foreign entities but working in the U.S. include State Bank of India v. N.L.R.B., 808 F.2d 526 (7th Cir. 1986), cert. denied, 483 U.S. 1005 (1987); Goethe House, N.Y., German Cultural Center, 288 NLRB 257 (1988), election enjoined by 685 F.Supp. 427 (S.D.N.Y. 1988), rev'd, 869 F.2d 75 (2d Cir.), cert. denied, 493 U.S. 810 (1989); Great Lakes Dredge & Dock Co., 240 NLRB 197 (1979); S.K. Prods. Corp., 230 NLRB 1211 (1977). Illustrative of decisions in which the RLA has been applied to employees of foreign carriers who work or are based in the U.S. are Air Line Pilots Ass'n v. TACA Int'l Airlines, 748 F.2d 965; Ruby v. TACA Int'l Airlines, 439 F.2d 1359 (5th Cir. 1971); Saudi Arabian Airlines, 32 NMB 206 (2005); Acrovias de Mexico, 20 NMB 584 (1993); Egypt Air, 19 NMB 166 (1992).
 
Foreign governments also may impose "solutions" for their nationals that directly impact U.S. carriers and employees. For example, in recognition of the difficulties that may be presented by the application of different national laws to transnational airline operations and relationships, the Association of European Airlines (which includes most of the major European carriers) proposed the adoption of a "Transatlantic Common Aviation Area" with the objective of substituting for the bilateral relationships between nations a common regulatory framework within which European and U.S. carriers will operate. See Towards a Transatlantic Common Aviation Area AEA Policy Statement (September 1999 Association of European Airlines). That approach was adopted in a 2002 decision of the European Court of Justice ("ECJ"), that threatened to invalidate existing bilateral agreements between single European nations and the U.S. and instead to require multilateral agreements between the European Community as a whole and the U.S. Commission of the European Communities v. Kingdom of Denmark, Case C-467/98 (2002). While such European initiatives could not be imposed directly upon U.S. carriers without, at minimum, action by the U.S. government n35, they have significant practical consequences for U.S. carriers and their employees. Moreover, these European activities serve to further demonstrate that issues as to which laws and rules should apply are being actively considered throughout the international aviation community. 
n35 The European Commission and the U.S. have been in discussions since 2003 regarding transatlantic "open skies," prompted, in part, by the above-cited 2002 ECJ decision. These discussions heated up in 2005 along with initiatives by the U.S. Department of Transportation to provide expanded opportunities for foreign entities with ownership interests in U.S. carriers to influence significantly fundamental aspects of those carriers' operations. Within the past year, Europe and the U.S. have reached agreements that would permit a significant expansion of the number of carriers who may operate across the Atlantic. What this will mean in practice remains to be seen.
 
In the absence of negotiation of satisfactory solutions among nations, the best that can be expected is that U.S. employers will recognize that their long-term self interest is not served by attempting to walk away from contractual understandings, by creating divergent work rules and splintered bargaining units based on the location of the employment base, or by attempting to play-off affected employees against one another. If not, and confrontation is inevitable, one would hope that the law will be applied in a way that yields rational results rather than being dictated by antiquated, rigid notions developed in an entirely different economic setting.
It would seem logical to apply U.S. labor law when the operations involved are those of an American company, the existing employees' terms and conditions of employment have been governed by a collective bargaining agreement negotiated in the U.S. between U.S. employers and labor unions or by work rules established and applied in the U.S. to U.S.-based employees, the activities abroad have substantial effects within the U.S., and the employer has decided voluntarily to engage in the international activities that have given rise to the particular dispute. Where such circumstances are present, it would appear that the United States has a more vital interest in the controversy than the nation in which the operation or employee base is located, and that application of U.S. labor law is warranted.