A majority of the U.S. Supreme Court ruled June 1 that the National Labor Relations Act doesn’t bar a concrete company’s lawsuit for damages incurred during a union walk off.
The five-justice majority in Glacier Northwest v. International Brotherhood of Teamsters Local Union No. 174 found a state court tort lawsuit wasn’t preempted by NLRA even though the damages occurred during concerted activity by union members.
The lawsuit was filed by concrete company Glacier Northwest in Washington state court and claimed members of the International Brotherhood of Teamsters Local Union No. 174 had timed a union walkout to intentionally destroy the company’s property. After a collective bargaining agreement expired between the union and the company and they’d failed to reach a new agreement, the union instructed drivers for the company to stop work on the morning of Aug. 11, 2017.
According to the court’s opinion, the union knew the company had already mixed a large amount of concrete and sent it out for delivery when it ordered the work stoppage. Drivers already on route were instructed to turn around and walk off the job and 16 drivers did so with full batches of concrete in mixers. Out of those drivers, seven notified management and asked for instructions or took action to prevent the concrete from hardening inside the truck and damaging it. The other nine left the trucks and didn’t notify anyone.
In the hours after, non-striking employees scrambled to empty the trucks before the concrete hardened and in a way to make sure chemicals in the concrete that could damage the environment were disposed of safely. While none of the trucks were damaged and concrete was disposed of in built-on-the-fly bunkers, it had hardened and couldn’t be used.
Glacier sued the union claiming it intentionally damaged the company’s property, committing a common law conversion and trespass to chattels. The lawsuit was quickly thrown out by a Washington state court that agreed with the union that NLRA protected concerted activity and the consequences weren’t covered by state law. The ruling was reversed on appeal then reinstated by the Washington Supreme Court that held “the NLRA preempts Glacier’s tort claims related to the loss of its concrete product because that loss was incidental to a strike arguably protected by federal law.”
But the U.S. Supreme Court overturned that holding after agreeing to review the case.
“The NLRA protects the right to strike, but that right is not absolute,” wrote Justice Amy Coney Barret for the majority joined by Chief Justice John Roberts and Justices Sonia Sotomayor, Elena Kagan and Brett Kavanaugh.
Noting that the National Labor Relations Board has long held NLRA doesn’t shield strikers that don’t take reasonable steps to protect employer property from foreseeable damage due to work stops, the majority found the union failed to prove the drivers’ actions were protected.
“The Union knew that concrete is highly perishable and that it can last for only a limited time in a delivery truck’s rotating drum. It also knew that concrete left to harden in a truck’s drum causes significant damage to the truck. The Union nevertheless coordinated with truck drivers to initiate the strike when Glacier was in the midst of batching large quantities of concrete and delivering it to customers,” wrote Barrett.
The court declined to give NLRA the “generous interpretation” requested by the union and also differentiated the case from other holdings where work strikes impacted perishable goods spoiling. Since the concrete could only be mixed when truck drivers were ready for delivery and the drivers showed up, the court wrote, the drivers prompted the creation of the perishable product. It also rejected the argument that the union isn’t responsible for timing strikes to minimize financial harm to an employer, finding the fact that no to very few steps were taken by the drivers to protect the company’s property. The court also rejected the argument that by returning the trucks and leaving the mixers running, the union members took precautions.
“Because the Union took affirmative steps to endanger Glacier’s property rather than reasonable precautions to mitigate that risk, the NLRA does not arguably protect its conduct,” wrote Barrett.
Justice Clarence Thomas wrote a concurrence in judgment joined by Justice Neil Gorsuch. While he agreed NLRA didn’t close out state claims, Thomas wrote separately in critique of the U.S. Supreme Court’s 1959 ruling in San Diego Building Trades Council v. Garmon that held state courts can’t decide state law claims are “arguably” protected by NLRA. The preemption of state law by federal law under that decision, Thomas wrote, is unusual and the majority’s decision could leave the door open to preempted jurisdiction in cases where a union’s conduct and coverage under NLRA is more murky. While the case didn’t ask the justices to reexamine Garmon, Thomas wrote future cases could.
Justice Samuel Alito also penned a concurrence in judgment joined by Thomas and Gorsuch and wrote he believed the court didn’t need to consider Garmon at all after it found the strike wasn’t protected under NLRA.
Justice Ketanji Brown Jackson was the only member to dissent. Jackson wrote she didn’t believe the Supreme Court should have considered the appeal while a pending case in front of NLRB based on the same strike is being considered.
“In my view, today’s misguided foray underscores the wisdom of Congress’s decision to create an agency that is uniquely positioned to evaluate the facts and apply the law in cases such as this one,” wrote Jackson. “This case is Exhibit A as to why the Board—and not the courts—should ordinarily take the first crack at resolving contentious, fact-bound labor disputes of this nature.”
The Supreme Court published two other opinions June 1 over the scienter requirement of the False Claims Act and the Securities Act of 1933.