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NLRB v. GMC - 373 U.S. 734, 83 S. Ct. 1453 (1963)

Rule:

An agency shop does not constitute an unfair labor practice and is not prohibited by § 8 of the National Labor Relations Act.

Facts:

The employees of respondent General Motors Corporation ("GMC") were represented by a union in a single, multi-plant, company-wide unit. In 1959, the union sent a letter to GMC proposing an agency shop agreement. Under the agreement, employment would be conditioned upon payment of money equal to initiation fee and regular monthly dues paid by union members. Membership in the union would be available to employees on non-discriminatory terms. Those choosing not to join would make required payments and would share in union expenditures. GMC made no counterproposal, but replied to the union's letter that the proposed agreement would violate the National Labor Relations Act ("NLRA") and that it was thus required to decline the union’s request for a meeting to bargain over the proposal. Thereafter, the union filed a complaint with the National Labor Relations Board ("NLRB") against GMC for its alleged refusal to bargain in good faith. Holding that the union's proposal comported fully with the congressional declaration of policy in favor of union-security contracts and therefore a mandatory subject as to which the NLRA obliged GMC to bargain in good faith, the NLRB concluded that GMC committed an unfair labor practice by refusing to bargain in good faith with the union. On GMC petition for review, a federal court of appeals set aside the NLRB's order, and held that the proposed agency shop agreement would violate §§ 7, 8 (a)(1), and 8 (a)(3) of the NLRA. The union was granted a writ of certiorari.

Issue:

(1) Was the agency shop an unfair labor practice under § 8 of the NLRA? (2) Did GMC commit an unfair labor practice by refusing to bargain in good faith with the union?

Answer:

(1) No; (2) Yes.

Conclusion:

The Supreme Court of the United States reversed and remanded the decision of the court of appeals and held that the proposed agreement did not violate the NLRA or its proviso. According to the Court, an "agency shop" arrangement, which left union membership optional with the employees but required that, as a condition of continued employment, nonunion employees pay to the union sums equal to the initiation fees and periodic dues paid by union members, did not in itself constitute an unfair labor practice under § 8 (a)(3) of the NLRA and was not prohibited by § 7 or § 8. Congress' desire was to reduce compulsory unionism while allowing bargaining agent financial support. As to the second issue, the Court held that since the agency shop agreement was not prohibited, GMC committed an unfair labor practice, within the meaning of § 8 (a)(5), when it unconditionally refused to bargain with the union over the proposal for the adoption of such an arrangement.

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