cox - scope of bargaining

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Citation: 71 Harv. L. Rev. 1401 1957

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VOLUME 71

I HARVARD LAW REVIEWTHE DUTY TO BARGAIN IN GOOD FAITH

Archibald Cox *Recent judicialand administrativedecisions suggest that the criterionof good-faith collective bargaining is being expanded beyond thesubjective test of willingness to negotiate an agreement toward anobjective standard of good bargainingpractice. In this article,Pro-fessor Cox analyzes these decisions in the light of their antecedentsand calls for closer study of their policy implications before thechange is accepted.

The standard set up by the statute is not a rule of law; it is rathera way of life. Life in all its fullness must supply the answer tothe riddle.Mr. JusticeCardozo'

Q ECTION 8(a) (5) of the National Labor Relations Act pro-vides that it shall be an unfair labor practice fo r an employer"to refuse to bargain collectively with the representatives of hisemployees." 2 In explaining this provision while the Wagner Bill

* Professor of Law, Harvard Law School. A.B., Harvard, 1934, LL.B. 1937.'Welch v. Helvering, 290 U.S. XXI, 115 (1933).I Section 8(5) of the original National Labor Relations Act, C.372, 49 Stat. 453

(1935), provided that it was an unfair labor practice for an employerto refuse to bargain collectively with the representatives of his employees, sub-ject to the provisions of Section 9(a).The provision was carried forward by the Taft-Hartley Act as 8(a) (5), 61 Stat.

X41 (1947), 29 U.S.C. x58(a)(5) (1952). The latter act also added 8(b)(3), 61 Stat. 141 (1947), 29 U.S.C. i58(b)(3) (1952), which provides that itshall be an unfair labor practice for a labor union

to refuse to bargain collectively with an employer, provided it is the repre-sentative of his employees, subject to the provisions of Section 9(a).The Taft-Hartley Act also added. in 8(d), 61 Stat. 142 (1947), 29 U.S.C. z58(d) (1952), a definition of collective bargaining which reads in pertinentpart:

[T]o bargain collectively is the performance of the mutual obligation of the em-ployer and the representative of the employees to meet at reasonable times andconfer in good faith with respect to wages, hours, and other terms and condi-tions of employment, or the negotiation of an agreement, or any questionarising thereunder, and the execution of a written contract incorporating any1401

JUNE 1958 NUMBER 8

HeinOnline -- 71 Harv. L. Rev. 1401 1957


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HARVARD LAW REVIEWwas being debated in Congress the Chairman of the Senate Com-mittee on Education and Labor said:

When the employees have chosen their organization, when theyhave selected their representatives, all the bill proposes to do isto escort them to the door of the employer and say, 'Here they are,the legal representatives of your employees.' What happens behindthose doors is not inquired into, and the bill does not seek to inquireinto it.3Collective-bargaining law has come a long way since 1935. Afew years ago the National Labor Relations Board ruled that "itis settled law, that when an employer seeks to justify the refusal

of a wage increase upon an economic basis .. . good-faith bar-gaining . . .requires that upon request the employer attempt tosubstantiate its economic position by reasonable proof." I TheBoard has also decided that a labor union violates its duty to bar-gain in good faith by engaging in a slowdown, a "quickie" strike,or a strike in breach of contract during the negotiation of acollective-bargaining agreement.' If these decisions are sound,the law now regulates the way in which the parties are to dealwith each other. It tells them what they may do and what theymay not do, even though each recognizes the authority of theother and honestly seeks to reach an agreement. An employermay negotiate on every subject which the union raises fo r dis-cussion, he may be anxious to compromise in order to reachan agreement, but if he refuses to open his financial recordsfo r union scrutiny he may be guilty of an unfair labor prac-tice.6 A union may be desperately seeking to negotiate a con-tract, it may engage in full and fair discussion, but if the NLRB

agreement reached if requested by either party, but such obligation does notcompel either party to agree to a proposal or require the making of a conces-sion ....In this article the form "section 8(5)" is used in discussing the original Wagner Actand cases decided prior to the Taft-Hartley amendments. "Section 8(a)(5)" isused in discussing the present law and making general references having no his-torical implications.3 79 CONG. Rlc. 766o (1935) (statement of Senator Walsh).4 Truitt Mfg. Co., iio N.L.R.B. 856 (1954), enforcement denied, 224 F.2d 869

(4th Cir. 1955), rev'd,351 U.S. 149 (1956).a International Union, United Mine Workers (the Boone County case), i7N.L.R.B. 1o95 (iqs7); Textile Workers (the PersonalProducts case), io8 N.L.R.B.743 (1954), enforced in part, set aside in part, 227 F.2d 409 (D.C. Cir. 1955),cert. denied, 352 U.S. 864 (i956).

See pp. 1425-28 infra.

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GOOD-FAITH BARGAININGthinks that it has used improper economic pressure the NLRBwill rule that it has refused to bargain collectively. The lawtells the parties what subjects they must bargain about 7 andalso, perhaps, what subjects neither one may lawfully interjectinto the discussions over the objection of the other.8 In Senator-Walsh's metaphor, the law has crossed the threshold into theconference room and now looks over the negotiator's shoulder.Is the next step to take a seat at the bargaining table?

In this paper I propose to review the path the law has traveledin regulating the procedures of collective bargaining through theimposition of a duty to bargain "in good faith." The story islargely one of decisions transforming the simple requirements ofunion recognition and bona fide negotiation into doctrines throughwhich the NLRB may come to condemn any conduct whichsharply departs from good bargaining practice. Problems relatingto the subject matter of collective bargaining and the principlesof majority rule are both excluded.9 My aim is not to collectthe precedents and state the current rules, but to observe a fewcritical turning points which may help us to understand wherewe have been and, possibly, where we are going.

I.The duty to bargain collectively was first imposed upon em-

ployers during World War I.10 The National War Labor Boardaffirmed the rights of workers to organize in trade unions and tobargain collectively through chosen representatives.' The cor-

"E.g., Richfield Oil Corp. v. NLRB, 231 F.2d 717 (D.C. Cir.), cert. denied,351 U.S. 909 (i956); Inland Steel Co. v. NLRB, I70 F.2d 247 (7th Cir. 1948),cert. denied, 336 U.S. 96o ('949).

'Cf. Allis-Chalmers Mfg. Co. v. NLRB, 213 F.2d 374 (7th Cir. 1954) ; NLRBv. Dalton Tel. Co., 187 F.2d 8ii (5th Cir.), cert. denied, 342 U.S. 824 ('95').'For discussions of government regulation of the subject matter of collectivebargaining, see Cox & Dunlop, Regulation of Collective Bargaining by the Na-tional Labor Relations Board, 63 HAgv. L. Rxv. 389 (ig5o); Findling & Colby,Regulation of Collective Bargaining by the National Labor Relations Board-Another View, 5I CoLrm. L. RFv. 170 (i951).'OThe historical background, legislative history, and early interpretation of 8(5) are fully discussed in Smith, Th e Evolution of the "Duty to Bargain"Con-cept in American Law, 39 MicH. L. REv. xo65 (1941). I have relied heavily uponProfessor Smith's work in the brief summ ary here.

"1 ee 6 SEC'Vr LABOR AN. REP. lOO (i918).

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HARVARD LAW REVIEWrelative duty was occasionally expressed in findings directing em -ployers to meet with shop committees "to take up the differencesthat still exist in an earnest endeavour to reach an agreement on allpoints at issue," 12 but the extent of the obligation went undefinedand no criteria were developed for enforcement.

The Wilsonian labor policies were carried farthest in the trans-portation industry, for the railroads were under government man-agement. In returning them to private control, the Congresssought to encourage the settlement of disputes first by negotiationand, failing agreement, by decision of the Railroad Labor Board.Section 301 of the Transportation Act of 1920 declared it to be the"duty of al l carriers and their officers, employees, and agents toexert every reasonable effort and adopt every available means toavoid any interruption to the operation of any carrier growingout of any dispute . .. 1 Since the clause was hortatory, therewas no occasion to determine its exact meaning. The RailroadLabor Board emphasized the duty but its chief concern was toprotect itself against pressure to decide issues which the partieshad not thoroughly explored. 4

Section 301 was carried forward into the Railway Labor Actof 1926 with slight changes in phraseology:

It shall be the duty of all carriers, their officers, agents, and em-ployees to exert every reasonable effort to make and maintainagreements concerning rates of pay, rules, and working condi-tions .... 15

The duty is enforceable by a private suit for an injunction, butsince the adjudicated cases involve outright refusals to bargainthey add little to the bare words of the statute."

The New Deal revived the policies of the old War Labor Board.Section 7(a) of the National Industrial Recovery Act of 1933declared that "employees shall have the right to organize andbargain collectively through representatives of their own choos-

12 Amalgamated Meat Cutters v. Western Cold Storage Co., National W arLabor Board Docket No. So (I919). The statement is quoted in Smith, supra notezo, at io69-7o.

13 C. 9i, 41 Stat. 469."4See, e.g., International Ass'n of Machinists, 2 R.L.B. 87, 89 (1921).15 2, First, 44 Stat. 577, 45 U.S.C. 152, First (1952).16-E.g., Virginian Ry. v. System Federation No. 4o , Ry. Employees, 300 U.S.

515 (1937).

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GOOD-FAITH BARGAININGing ... ., 7 The view taken by the National Labor Board,which administered this section, was that:

True collective bargaining involves more than the holding of con-ferences and the exchange of pleasantries. . . .While the law doesnot compel the parties to reach agreement, it does contemplate thatboth parties will approach the negotiations with an open mindand will make a reasonable effort to reach a common ground ofagreement.'8Its successor, the old National Labor Relations Board, an-nounced "the incontestibly sound principle" that the employer

had a duty "to negotiate in good faith with his employees' repre-sentatives; to match their proposals, if unacceptable, with counter-,proposals; and to make every reasonable effort to reach an agree-ment." 19Neither Board inquired into the difficulties inherent in thisformula. How was bad faith to be proved? Could reliance upon

a refusal to make counterproposals be squared with free nego-tiation? Did the duty to make "every reasonable effort" to reachan agreement require an employer to refrain from taking un-reasonable positions or oblige him to make concessions? Werethe parties under any restrictions as to the manner of their nego-tiations? The cases which came before the Boards did not re-quire decisions upon these questions for most of them arose as aresult of refusals to deal with a union, but there is considerableevidence that, under the NRA, compromise was thought to be anessential part of the statutory obligation. In the famous HoudeEngineering case,2 0 the old NLRB pointed out that the funda-mental aim of the NRA was to restore prosperity by increasingpurchasing power. Industry was to be stabilized by exemptionsfrom the antitrust laws. Hours were to be reduced, wages in-creased, and re-employment effected on the largest possible scale."Collective bargaining and the collective agreements resultingtherefrom would be an essential part of this process. And in theprojected stabilization of industry, based upon the principle offair competition, it was intended that wages, hours and working

27 C. 90, 48 Stat. 198.i" Connecticut Coke Co., N.L.B. pt. 2, 88,89 (934).19 Houde Engineering Corp., i N.L.R.B. (old) 35 (i934).201 N.L.R.B. (old) 35 (934). The case is best known as the first unequivocal

declaration of the principle of majority rule which was subsequently embodied inNLRA 9(a), 49 Stat. 453 (i935), as amended, 29 U.S.C. i59(a) (1952).

31g58] 1405



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HARVARD LAW REVIEWconditions ...be stabilized as far as possible, and should bereasonably uniform within each particular industry. In achievingthese objects, collective agreements would play an important, ifnot indispensable, part, since the uniform requirements fixed inthe codes were never intended to do more than set a minimum." 21In this milieu the authorities who enforced the codes would hardlyhave been worried by the prospects of adopting a definition ofcollective bargaining which put pressure upon employers to raisewages and grant other concessions in a sincere effort to agreewith the union representing their employees. The announcedduty to match proposals with counterproposals may well havebeen literally intended. The logical consequence would be forthe Board to scrutinize the reasonableness of an employer's posi-tion as the measure of his good faith.

The Wagner Act was passed against this background. Its mostactive advocates at the executive end of Pennsylvania Avenuewere closely associated with the old National Labor and NationalLabor Relations Boards. So far as the record shows, however, noone attributed much significance to the imposition of a duty tobargain collectively. The bill introduced by Senator Wagnerduring the Seventy-Third Congress 2 contained language similarto section 2, First, of the Railway Labor Act, but the provisionwas excised in committee, probably because it seemed doubtfulwhether so vague a duty could be enforced.2 3 The bill which be-came the Wagner Act was introduced at the Seventy-Fourth Con-gress without a provision corresponding to section 8(5). Thesubsection was added in the Senate Committee after Lloyd K.Garrison, chairman of the old National Labor Board, had arguedthat it was necessary to make the guaranty of a right of self-organization effective. 4

Neither the witnesses who testified in committee nor the sena-tors and representatives who took the floor paid great heed tothe section and none of them showed an appreciation of the diffi-culties of application. A speech by Senator Wagner epitomizesthe discussion. First he categorically asserted that section 8(5)

21 1 N.L.R.B. (old) at 36-37.22 S. 926, 73 d Cong., 2d Sess. (1934).23 See HearingsBefore the Senate Committee on Education and Labor on S.

2926, 73d Cong., 2d Sess. pt. i, at 59, 6o (i934).24 See Hearings Before the Senate Committee on Education and Labor on S.

7958, 74th Cong., ist Sess. pt. 2, at 137 (1935).

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GOOD-FAITH BARGAININGdoes not compel anyone to make a compact of any kind if no termsare arrived at that are satisfactory to him. The very essence ofcollective bargaining is that either party shall be free to withdrawif its conditions are not met.2 5

Then, in the next paragraph, he turned to plead for the enactmentof section 8(5) as clear congressional confirmation of the "in-contestibly sound principle" established by the Houde Engineer-ing case.26 No one inquired whether an employer who was re-quired "to match proposals, if unacceptable, with counterpro-posals" and to demonstrate that he had made "every reasonableeffort to reach an agreement," could really be free to withdraw ifhis conditions were not met. Senator Walsh's categorital assur-ances have already been quoted.2 7

By reading the testimony, the debate, and the history of thetimes with a large measure of hindsight one can discern fourpurposes which entered into the enactment of section 8(5).

(i) The simplest and most direct purpose was to reduce thenumber of strikes for union recognition. Prior to 1935 the out-right refusal of employers to deal with a labor union was a pro-lific cause of industrial strife.28 The cause could be eliminated byplacing an employer under a statutory duty to acknowledge asthe legal representative of all his employees any union designatedby the majority. In arguing that the act was constitutional theGovernment placed great stress upon this purpose.2 9

(2) The most important purpose of the Wagner Act was tocreate aggregations of economic power on the side of employeescountervailing the existing power of corporations to establish laborstandards. When the authors of the act spoke of "inequality ofbargaining power" between employee and employer, they had inmind the famous dictum of Mr. Chief Justice Taft:

[Labor unions] were organized out of the necessities of the situa-tion. A single employee was helpless in dealing with an employer.He was dependent ordinarily on his daily wage for the maintenanceof himself and family. If the employer refused to pay him thewages that he thought fair, he was nevertheless unable to leave the25 79 CONG. REC. 7571 (935).2 6Ibid.27 See p. 1402 supra.2B NLRB v. Jones & Laughlin Steel Corp., 301 U.S. i, 42 (1937).29 Brief for the Appellee, pp. 46-50, 144, Associated Press v. NLRB, 301 U.S.

103 (1937).

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1408 HARVARD LAW REVIEW [Vol. 71employ and to resist arbitrary and unfair treatment. Union wasessential to give laborers opportunity to deal on equality withtheir employer. 80The denial of recognition is an effective means of breaking up

a struggling young union too weak for a successful strike. Afterthe enthusiasm of organization and the high hopes of successfulnegotiations, it is a devastating psychological blow to have theemployer shut the office door in the union's face. Imposing a legalduty to recognize the union would prevent such anti-union tacticsand thereby contribute to the growth of strong labor organizations.

(3) Section 8(5) was also intended to implement the basicphilosophy of the act by imposing the duty to engage in collective- as distinguished from individual - bargaining. The courts ex-emplified the obligation by holding that after a representative hasbeen designated, it is an unfair labor practice for an employer tonegotiate wages or other terms of employment with individualemployees. 31 It is also possible that Congress meant that theduty to deal with the group - with the collectivity - included amore far-reaching idea usually expressed in metaphors. An em-ployer must look upon labor as an equal partner, and "when wehave such a partnership . . . then one partner cannot do any-thing without consulting the other partner." 32 Or to change

* he figure, the divine right of the king must yield to a constitutionalmonarchy, in which a large measure of industrial democracy willprevail.3 Wages, hours, and conditions of employment should bedetermined by mutual consent.

(4) There were also those who looked upon collective bargain-ing as a rational process of persuasion. Collective bargaining, itwas thought, enables employers and employees to dig behind theirprejudices and exchange their views with the result that agree-ment is reached on many points while on others it is discoveredthat the area of disagreement is so narrow that compromise ischeaper than battle. As early as 1902 an industrial commissionreported:

The chief advantage which comes from the practice of periodically3o American Steel Foundries v. Tri-City Central Trades Council, 257 U.S. 184,

209 (1921).31 Medo Photo Supply Corp. v. NLRB, 321 U.S. 678 (1944); cf. J. I. Case Co.

v. NLRB, 321 U.S. 332 (1944).2 Leiserson, The Meaning of Labor Representation, go ANNALS 22, 23 (1920).3 Cf. CATLim, Tim LABOR PROBLEM 42 4 (rev. ed. X935).



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GOOD-FAITH BARGAININGdetermining the conditions of labor by collective bargaining directlybetween employers and employees is, that thereby each side ob-tains a better understanding of the actual state of the industry,of the conditions which confront the other side, and of the motiveswhich influence it. Most strikes and lockouts would not occur ifeach party understood exactly the position of the other.34Although there is little doubt that the sponsors of the Wagner

Act hoped that the statute would accomplish all four purposes,only the first two can be said to have been written into law. Thereis no real evidence whether the sponsors intended to write thethird and fourth directly into the statute or counted upon timeand human nature to realize these objectives. Collective bargain-ing is curiously ambivalent even today. In one aspect collectivebargaining is a brute contest of economic power somewhat maskedby polite manners and voluminous statistics. As the relationmatures, Lilliputian bonds control the opposing concentrationsof economic power; they lack legal sanctions but are nonethelesseffective to contain the use of power. Initially it may be only fearof the economic consequences of disagreement that turns theparties to facts, reason, a sense of responsibility, a responsivenessto government and public opinion, and moral principle; but intime these forces generate their own compulsions, and negotiatinga contract approaches the ideal of informed persuasion.

The purpose of the original Wagner Act was to create a neces-sary balance of economic power. The act also aimed at idealbargaining. It intruded at least so far as to protect unionizationfrom interference by employers and to compel them to recognizethe employees' representatives. Did the statute leave the furtherconsequences to develop without government regulation or didit legislate some of the state of mind and habits of conduct whichmake up the ideal bargaining relation?

II.It is patently an unfair labor practice for an employer to with-

hold recognition from the union designated by the majority ofemployees. Refusing to meet and treat with the union nego-tiators 11 or attaching conditions to entering into negotiations is

4 H.R. Doc. No. 38o, 57th Cong., ist Sess. 844 (1902)." NLRB v. United States Cold Storage Corp., 203 F.2d 924 (5th Cir.), cert.denied, 346 U.S. 818 (1953); NLRB v. Lettie Lee, Inc., 14o F.2d 243, 248-49 (9th

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HARVARD LAW REVIEWno less obviously unfair,36 for, whatever its meaning, the dutyimposed by section 8(a) (5) is unqualified. In the early days ofthe Wagner Act a considerable number of employers politely metwith the union representatives, listened to their demands and thesupporting arguments and then rejected them. Although Sena-Cir. 1944). Meetings must be held at a place convenient to the plant. Compare NLRBv. P. Lorillard Co., 117 F.2d 921 (6th Cir. 1941), rev'd on other grounds, 314 U.S.512 (1942) (insistence upon bargaining in New York City for a plant in Middle-town, Ohio, held an unfair labor practice), and Westinghouse Pac. Coast BrakeCo., 89 N.L.R.B. 145 (,950) (insistence upon bargaining in Pittsburgh for a WestCoast plant held unfair), with National Grinding Wheel Co., 75 N.L.R.B. 905(X948) (proposal that conferences be held fourteen miles from the plant not unfairwhen union objected only to the company's refusal to pay transportation costs).

" E.g., NLRB v. Hoppes Mfg. Co., 17o F.2d 962 (6th Cir. 1948) (refusal tonegotiate unless union abandoned request for higher wages); American LaundryMach. Co., 76 N.L.R.B. 98I (1948), enforcement granted, 174 F.2d 124 (6th Cir.1949) (per curiam) (refusal to negotiate unless union withdrew unfair-labor-prac-tice charge and abandoned strike). The cases dealing with the imposition of condi-tions, especially those dealing with performance bonds, are in an unnecessary stateof confusion. Four categories of conditions should be recognized. (i) It is undis-putably an unfair labor practice to attach any condition to entering into negotia-tions. (2) Sometimes a negotiator states that it must be a condition of any con-tract that the other party agree to a certain proposal; for example, that the unionpost a heavy performance bond. There are decisions which reason that since thereis a duty to sign a contract if agreement is reached upon its terms, it is an unfairlabor practice to refuse to sign unless the union takes steps to guarantee perform-ance. Dalton Tel. Co., 82 N.L.R.B. iooi (1949), enforcement granted, 187 F.2d81i (5th Cir. 195i), cert. denied, 342 U.S. 824 (1952); Scripto Mfg. Co., 36N.L.R.B. 411 (i94i); see jasper Blackburn Products Corp., 2i N.L.R.B. 1240,1254-55 (2940). This is a misconception. The general understanding in collectivebargaining is that agreement on any particular point is tentative until -there isagreement upon all the issues. To say that posting a performance bond is a condi-tion to executing an agreement is simply a way of bargaining for this term in theover-all agreement. It is not an unfair labor practice per se. Accord, NLRB v.I.B.S. Mfg. Co., 21o F.2d 634 (5th Cir. 1954). But cf. Union Mfg. Co., 76 N.L.R.B.322, 325 (1948), enforcement granted, 179 F.2d 51i (5th Cir. 1950). (3) Some de-mands or proposals may be evidence that the party making them is seeking to pre-vent agreement because he intends not to sign a contract upon any terms. It vio-lates 8(a) (5) and 8(b) (3) to conduct sham negotiations in this state of mind.See pp. 1422-23 infra. The weight of the inference depends upon the nature of thedemand, its timing, and other circumstances. Many anti-union employers who de-manded performance bonds in the 193o's and 1940's were proved by other evi-dence to be going through the motions of bargaining with a fixed determination notto enter into a contract with a labor union. Very few employers who have acceptedcollective bargaining have demanded such an undertaking. It is proper therefore totreat a firm demand for a bond as evidence supporting a finding of bad faith.Standard Generator-Serv. Co., 90 N.L.R.B. 79o (195o), enforcement granted, 186F.2d 6o6 (8th Cir. 295I); Tower Hosiery Mills, Inc., 81 N.L.R.B. 658 (1949), en-forcement granted, i8o F.2d 70, (4 th Cir.), cert. denied, 340 U.S. 8x (1950);jasper Blackburn Products Corp., 21 N.L.R.B. 1240 (1940) (containing broaderdictum). (4) Making acquiescence to a proposed term of the contract a condition

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GOOD-FAITH BARGAININGtor Walsh had stated that this would satisfy section 8(5) ,3 theNLRB and courts have always held it to be an unfair labor prac-tice.3 "[TIhere must be common willingness among the partiesto discuss freely and fully their respective claims and demandsand, when these are opposed, to justify them on reason." 39 Al-though the law cannot open a man's mind, it can at least compelhim to conduct himself as if he were trying to persuade andwere willing to be persuaded. To offer the union a contract say-ing, "Take it or leave it," is not bargaining collectively within themeaning of the act.40

The duty to engage in discussion, listening to the union's pro-posals and giving the grounds for any disagreement, extends toeach and every topic the union may wish to discuss, providedthat it falls within the phrase "rates of pay, wages, hours of em-ployment, or other terms and conditions of employment." 41Originally there was room fo r the argument that section 8(5)required only recognition of the union and acceptance of the gen-eral principle of collective bargaining, but the NLRB has longundertaken, with judicial approval, to define compulsory sub-jects of bargaining, and in 1947 the addition of section 8(d)confirmed its interpretation. 42 In Andrew Jergens Co.43 an em -ployer and a union had little difficulty in coming close to agree-ment upon all the terms of a contract except union security. Thecompany refused to negotiate on this issue claiming that it wasbarred by a War Labor Board directive. Other evidence per-suaded the NLRB that the asserted justification was a pretenseand the respondent had a fixed determination not to grant union-to entering into an agreement is an unfair labor practice if the proposed term wouldbe unlawful or inconsistent with the policy of the act. National Maritime Union(the Texas Co. case), 78 N.L.R.B. 971 (1948), enforcement granted, 175 F.2d 686(2d Cir. 1949), cert. denied, 338 U.S. 954 (195o).

37 79 CONG. REC. 7660 (1935)."8See, e.g., NLRB v. Montgomery Ward & Co., 133 F.2d 676 (9th Cir. I943);

NLRB v. Westinghouse Air Brake Co., I2M F.2d 1004 (3d Cir. 194); Wilson & Co.v. NLRB, iiS F.2d 759 (8th Cir. 1940).9 NLRB v. George P. Pilling & Son Co., ri9 F.2d 32, 37 (3d Cir. 194).

40 See Brown & Root, Inc., 86 N.L.R.B. 520, 521 0949), enforced in part, setaside in partsub nom. NLRB v. Ozark Dam Constructors, i9o F.2d 222 (8th Cir.1951).

" NLRA 9(a), 49 Stat. 453 (1935), as amended, 29 U.S.C. 159(a) (1952).See also NLRA 8(d), added by 61 Stat. 142 (1947), 29 U.S.C. 158(d) (1952).

42 See Cox & Dunlop, Regulation of Collective Bargaining by the NationalLabor Relations Board, 63 HARv. L. REv. 389, 391-401 (1950).

43 76 N.L.R.B. 363 (948), enforcement granted, 175 F.2d 130 (gth Cir. 1949).

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HARVARD LAW REVIEWsecurity provisions or even to discuss them with the union. "Suchcomplete foreclosure of discussion of a proper subject of collec-tive bargaining is a negation of the good faith bargaining requiredby the statute." 44The Andrew Jergensdecision suggests a more troublesome case.Suppose that the company's lawyer had replied to the union'sdemand for a closed shop, "W e have studied this problem care-fully, and our minds are made up. You fellows know all thearguments on both sides and so do I. Let's not waste time re-peating them. We won't grant the closed shop or any otherform of union-security clause, and every time you start talkingabout it we intend to leave the room." Would such conduct violatesection 8(a) (5)? The language of countless opinions and trialexaminers' reports is broad enough to hold it unfair,45 but theSupreme Court has said that "the Act does not encourage a partyto engage in fruitless marathon discussions at the expense of frankstatement and support of his position." 46 On principle, refusingto participate in the give-and-take of argument ought to be anunfair labor practice. Participation in debate often produceschanges in a seemingly fixed position either because new factsare brought to light or because the strengths and weaknesses ofthe several arguments become apparent. Sometimes the partieshit upon some novel compromise of an issue which has beenthrashed over and over. Much is gained even by giving eachside a better picture of the strength of the other's convictions. Thecost .is so slight that the potential gains easily justify legal com-pulsion to engage in the discussion.Since 1947 section 8(b)(3) has imposed the duties discussedabove upon employees' representatives. 47

III.It was not enough fo r the law to compel the parties to meet

and treat without passing judgment upon the quality of the nego-44 76 N.L.R.B. at 366.4 See the discussion of good faith in pp . 1418-28.46 NLRB v. American Nat'l Ins. Co., 343 U.S. 395, 404 (1952). See also NLRBv. P. Lorillard Co., 117 F.2d 921, 924 (6th Cir. i94i), rev'd on other grounds, 314

U.S. 512 (1942).4 7 NLRA 8(b)(3), added by 61 Stat. 14I (1947), 29 U.S.C. 158(b)(3)(1952). For a general discussion of this section, see Note, Union Refusal to Bargain:Section 8(b) (3) of the National Labor Relations Act, 71 HAv. L. REv. 502 (1958).

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GOOD-FAITH BARGAININGtiations. The bargaining status of a union can be destroyed bygoing through the motions of negotiating almost as easily as bybluntly withholding recognition. The NLRB reports are filledwith cases in which a union won an election but lacked the eco-nomic power to use the strike as a weapon for compelling theemployer to grant it real participation in industrial government.As long as there are unions weak enough to be talked to death,there will be employers who are tempted to engage in the formsof collective bargaining without the substance.

The concept of "good faith" was brought into the law ofcollective bargaining as a solution to this problem. One whomerely went through the outward motions knowing that they werea sham could be said to lack good faith and held to violate sec-tion 8(5) despite the formal appearances. In NLRB -.Mont-gomery Ward & Co.,48 for example, seven conferences were heldbetween the management and the certified bargaining representa-tives of two different units within a three-month period. Theunion negotiators read and explained proposed contracts. Wardsrejected every proposal. The disagreement covered matters nor-mally settled in routine fashion as well as more substantial issues.For example, the unions' request for a recognition clause was re-jected on the ground that the statute controlled the question. Arequest for a promise not to discriminate against union membersmet a similar objection. When the unions proposed a clause call-ing for premium pay in the event that an employee was asked towork more than five hours without a meal period, the company'snegotiator insisted on substituting six hours even though his su-perior had advised him that "under normal conditions an em -ployee should not be worked more than five consecutive hourswithout a meal period." There was evidence of stalling. Whenthe unions asked for an immediate reply to a proposal that con-ferences be scheduled with a higher executive, Wards' negotiatornotified his superior that after delaying 72 hours he would acceptthe proposal. Whenever the unions asked whether the manage-ment was willing to execute a written agreement, the managementreplied that the question was premature because the parties hadnot yet come to any agreement. Throughout the negotiations thecompany refused to offer counterproposals. Once when the unions

48 133 F.2d 676 (9th Cir. 1943).

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HARVARD LAW REVIEWsuggested that the company take the draft contracts which it hadsubmitted, cross out the objectionable features, and substitutesuch items as it desired, the company's spokesman replied thatsince the company was not seeking anything from the unions, itwas up to the unions to make the proposals. The NLRB held thatWards had violated section 8(5) by refusing to bargain in goodfaith. The Ninth Circuit enforced the resulting order, sayingthat the duty to bargain in good faith is an "obligation . . . toparticipate actively in the deliberations so as to indicate a presentintention to find a basis for agreement . . . " Not only mustthe employer have "an open mind and a sincere desire to reachan agreement" but "a sincere effort must be made to reach a com-mon ground." '9

The books abound with similar statements. 0 In making themboth the NLRB and the courts were seeking primarily to advancethe policies of protecting unions and compelling recognition. Inorder to distinguish the real from the sham they established asubjective test making the employer's state of mind the decisivefactor. So much is clear. The difficult problem is to identify thestate of mind precisely. Such phrases as "present intention tofind a basis for agreement" and "sincere effort . .. to reachcommon ground" suggest that willingness to compromise is anessential ingredient of good faith. The inference becomes evenstronger when the phrases are read against the background of theold National Labor Relations Board opinions which assert the duty"to match their proposals, if unacceptable, with counter-propo-sals; and to make every reasonable effort to reach an agreement." 51A man may wish to negotiate an agreement provided that histerms are met but be quite unwilling to compromise; or he maybe so anxious to reach an agreement that he is willing to acceptwhatever terms he can get. Which state of mind -which of

49Id. at 686, quoting in part from NLRB v. Reed & Prince Mfg. Co., ii S F.2d874, 885 (Ist Cir.), cert. denied, 313 U.S. 595 (1941).'0 See, e.g., NLRB v. Boss Mfg. Co., iS F.2d. 187, u8 9 (7th Cir. 1941)("Collective bargaining requires that the parties involved deal with each otherwith an open and fair mind and sincerely endeavor to overcome obstacles ordifficulties existing between the employer and the employees .... ); GlobeCotton Mills v. NLRB, 1o3 F.2d 91, 94 (sth Cir. 1939) ("ITihere is a duty onboth sides, though difficult of legal enforcement, to enter into discussion with anopen and fair mind, and a sincere purpose to find a basis of agreement . . .

51 Houde Engineering Corp., i N.L.R.B. (old) 35 (1934).

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GOOD-FAITH BARGAINING

all the intermediate states of mind - is necessary to bargain"in good faith"?To put the issue concretely suppose that since i942 Ames Cot-

ton Company has recognized Textile Workers Union of Americaand entered into a series of collective-bargaining agreements.None of the agreements provided for a union shop or the arbi-tration of unsettled grievances, but in all other respects the con-tracts were typical of the textile industry. The last agreementexpired December 31, 1957. TWUA proposed a ten-cents-an-hour wage increase, a union-shop clause, and an arbitrationclause. Ames Cotton rejected all three proposals, giving extensivearguments in support of its position and offering to renew the oldagreement. The union then modified its position and asked fora five-cents-an-hour wage increase, a maintenance-of-membershipclause, and arbitration of grievances. At the fourth conferencethe union intimated that it would consider a smaller wage in-crease, and some limits on the arbitration clause, and would be"reasonable" about union security if the company would be"reasonable" about the other issues. The company stood pat.TWUA then said, "Make us some kind of a counterproposal -any kind -to take back to the members." The company ada-mantly refused to do any more than renew the old contract. DidAmes Cotton bargain in good faith?

Certainly Ames Cotton would have made some kind of anoffer if it had a strong desire to reach an agreement. Withhold-ing an arbitration clause used by nearly all the unionized textilecompanies was hardly a sincere effort to reach common ground.TWUA indicated plainly enough that any little concession bywhich the union could save face would close the bargain and anyreasonable man truly anxious for agreement would have made theoffer. But this conclusion implies that an employer bargains ingood faith only when he is willing to make reasonable concessions.Indeed many employers complained that this was just the way inwhich the Board and courts were administering the Wagner Act,and in 1947 Congress added an explicit definition of the duty tobargain which provides that "such obligation does not compeleither party to agree to a proposal or require the making of aconcession." 2 It seems unlikely that Ames Cotton would havebeen found guilty of an unfair labor practice under the Wagner

52 NLRA 8(d), added by 6I Stat. 142 (1947), 29 U.S.C. i58(d) (1952).

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Act.5" Under the Taft--Hartley amendments its conduct wouldnot warrant a finding of bad faith.54We are drawn to the conclusion, therefore, that the conven-tional definition of good-faith bargaining as a sincere effort toreach an agreement goes beyond the statute. It can be correctedby expanding the formula to include the antinomy. The employer(or union) must engage in negotiations with a sincere desire toreach an agreement and must make an earnest effort to reach acommon ground, but it need make no concessions and may rejectany terms it deems unacceptable. One can argue that the formu-lation is too self-contradictory to survive. Either section 8(a) (5)must simply require union recognition and the formalities of nego-tiation, it is said, or else it must require that plus the making ofobjectively reasonable proposals.55 But I think that the ambiva-lent statement has meaning even though it borders on paradox. Itwould command the Board to reach a judgment mindful of con-flicting desiderata- (i) legal pressure upon labor and manage-ment to enter into joint agreements determining terms of employ-ment, and (2) complete freedom from government pressure as towhat the terms will be. That the relative weight to be given eachbranch of the antinomy depends upon fiat is both the strengthand weakness of the rule.56

The factual difference between the Montgomery Ward caseand the Ames Cotton example suggests another and more pre-cise formula. Wards rejected the basic principle that terms andconditions of employment should be established by the agree-ment between the management and the employees' representatives.Ames Cotton accepted union participation but would not agree onthe terms of the bargain. Conceivably its stubbornness could becalled arbitrary, selfish, or against the public interest, but thefacts supposed lay no foundation fo r the inference that it wasseeking to avoid agreement with the union. If this is the real

S n NLRB v. Jones & Laughlin Steel Corp., 301 U.S. z, 45 (I937), theCourt said, "The Act does not compel agreements between employers andemployees. It does not compel any agreement whatever. It does not prevent theemployer 'from refusing to make a collective contract and hiring individuals onwhatever terms' the employer 'may by unilateral action determine.'" See alsoNLRB v. P. Lorillard Co., 117 F.2d 92X, 923-24 (6th Cir. i94i), rev'd on othergrounds, 314 U.S. 512 (1942).54 NLRB v. United Clay Mines Corp., 2z9 F.2d 120 (6th Cir. 1955).

" See Smith, The Evolution of the "Duty to Bargain" Concept in AmericanLaw, 39 MicH. L. Rav. xo65, ixo8 (i94i).

" See Fuller, Reason and Fiat in Case Laws, 59 1ARV. L. Rzv. 76 (1946).

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GOOD-FAITH BARGAININGreason fo r concluding that Ames Cotton would not be held tohave violated section 8(a)(5), perhaps the true meaning of thestatute was most precisely articulated by Judge Magruder in thesecond Reed & Prince case in which he avoided a direct defini-tion of "good faith" and instead defined its opposite, "bad faith,"as a "desire not to reach an agreement with the union." 57Although this formulation stops somewhat short of the languageof some opinions, it expresses, as nearly as one can tell, theactual results of the decisions. It avoids most of the difficultiesinherent in earlier efforts to define good faith because it con-tains no suggeption that a negotiator must put reaching an agree-ment ahead of maintaining his position concerning substantiveterms and conditions of employment. It also solves the chiefproblem to which the notion of good faith was initally directed,fo r it separates the employers who are seeking to talk a unionto death from those who are merely stubborn negotiators exer-cising their full bargaining power.

"' NLRB v. Reed &Prince Mfg. Co., 205 F.2d 131, 134 (Ist Cir.), cert. denied,346 U.S. 887 (I953). This test appeared in some of the early opinions andseems to be gaining acceptance. See, e.g., NLRB v. United Clay Mines Corp., 219F.2d 120, 125 (6th Cir. i955) ("Lack of good faith may be found from . . . con-duct clearly showing an intent not to enter into a contract of any nature.");NLRB v. I.B.S. Mfg. Co., 210 F.2d 634, 638 (5th Cir. 1954) (A finding of lack ofgood faith requires clear proof "that the respondent had no wish for an agreementbut rather a wish to the contrary, and had conducted itself so as to defeat ratherthan promote agreement."); Singer Mfg. Co. v. NLRB, ri9 F.2d 131, 134 (7thCir.), cert. denied, 313 US. 595 (1941) ("We think the Board had full authorityto determine as a fact whether petitioner was acting in good faith or whetherits actions amounted to a mere superficial pretense at bargaining, - whether ithad actually the intent to bargain, sincerely and earnestly, - whether the negotia-tions were captious and accompanied by an active purpose and intent to defeator obstruct real bargaining."); NLRB v. P. LorMard Co., 117 F.2d 92i, 92 4 (6thCir. 1941), rev'd on other grounds, 314 U.S. 512 (1942) ("[T]he record does notshow that the respondent had a fixed resolve not to enter into an agreement withthe union."); Continental Oil Co. v. NLRB, 113 F.2d 473, 481 (ioth Cir. 1940),modified and remanded, 313 U.S. 212 (194) ("fixed resolve . . .not to come toany accord"); Cincinnati Steel Castings Co., 86 N.L.R.B. 592, 594 (1949) (evidencedid not show an intention to avoid coming to any agreement); Tower HosieryMills, Inc., 81 N.L.R.B. 658, 66o (1949), enforcement granted, x8o F.2d 70, (4thCir.), cert. denied, 340 U.S. 8x (95o) ("a determination not to conclude anagreement with the Union")." It should be recognized that even "the desire not to reach an agreement"test is an oversimplification because it assumes that the employer's conduct stemsfrom a single motive. In the hypothetical Ames Cotton case the company'snegotiators presumably thought that concessions would be harmful to the com-pany. Nevertheless they might also have realized that as a practical matter TWUAcould not agree to renew the old agreement and they might have welcomed the

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HARVARD LAW REVIEWThere are two differences between the antinomy and Judge

Magruder's more precise definition. To require proof that anemployer has an intention not to reach an agreement may im -pose a somewhat heavier burden of proof upon the General Coun-sel than the earlier formulation. Furthermore, to'say that sections8(a) (5) nd 8(b) (3) require the parties to have a sincere desirefo r agreement and to make every reasonable effort to reach com-mon ground suggests that the statute obliges them to follow proce-dures increasing the prospects fo r a negotiated agreement, andthis implication is not eliminated by adding the qualificationthat the negotiators have complete freedom to take any positionthat their judgment or fancy may dictate with respect to thesubstantive terms of employment. The latter difference is im -portant when we come to consider whether sections 8(a) (5)and 8(b) (3) authorize the regulation of collective-bargainingprocedures.

IV.Although the employer's (o r the union's) state of mind mayoccasionally be revealed by declarations,"s ordinarily the proof

must come by inference from external conduct. Many kindsof evidence have been found convincing. The weight of any itemdepends upon the circumstances. Stalling the negotiations byunexplained delays in answering correspondence and by theunnecessary postponement of meetings indicates a desire no tto reach an agreement with the union; 1o so does sending nego-tiators without authority to do more than argue or listen, 61 orprospect of a strike which would break the union. There appear to be no NLRBor judicial opinions analyzing this question of mixed motives.

" See NLRB v. Swift & Co., 127 F.2d 3o (6th Cir. 1942); Continental Oil Co.v. NLRB, 113 F.2d 473, 481 (ioth Cir. 1940); Stanislaus Implement and Hard-ware Co., ioi N.L.R.B. 394 (1952), enforcement granted, 226 F.2d 377 (9thCir. 1955).

60 See NLRB v. National Shoes, Inc., 2o8 F.2d 688 (2d Cir. I953) ; StanislausImplement and Hardware Co., ioi N.L.R.B. 39 4 (I952), enforcement grahted,226 F.2d 377 (9th Cir. 1955).

6 See NLRB v. A. E. Nettleton Co., 241 F.2d 13o (2d Cir. I957); NLRB v.Nesen, 211 F.2d 559 (9th Cir. 1954); Great So. Trucking Co. v. NLRB, 127 F.2d180 (4 th Cir. 1942); J. B. Cook Auto Mach. Co., 84 N.L.R.B. 688, 698 (1949),enforcement granted, 184 F.2d 84 5 (6th Cir. i95o). But see Lloyd A. Fry RoofingCo. v. NLRB, 216 F.2d 273 (9th Cir. 1954) (failure to give negotiators authorityto make binding commitment not an unfair practice per se).

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GOOD-FAITH BARGAININGrepudiating the commitments made by the company's bargainingrepresentative after it had led the union to believe that he hadfull authority to conclude an agreement. 62 The Board may besuspicious of the negotiator who constantly shifts his position orinterjects new demands just as agreement seems imminent 3but it seems unlikely that these last bits of evidence would begiven much weight in isolation. Insistence upon a verbatimtranscript of the negotiations has been considered evidence ofbad faith. 64 Proof that an employer engaged in interference,coercion, or restraint during bargaining conferences colors hisconduct.65 Other illustrations could be cited. In every case, thebasic question is whether the employer acted like a man witha mind closed against agreement with the union. The Board canjudge his subjective state of mind only by asking whether a nor-mal employer, willing to agree with a labor union, would havefollowed the same course of action.

The trickiest questions are raised by the use of evidence con-cerning the substantive positions taken by the employer duringnegotiations. For the Board to appraise the employer's bargain-ing position with respect to some major issue as a means of ascer-taining his good faith would involve passing judgment upofi thereasonableness of his proposals and thus would apply pressureto make concessions. There are too many reasons why an em -ployer who is willing to contract with a union might wish to denya wage increase or maintain an open shop fo r the Board to drawan inference of bad faith from the unreasonableness of his posi-tion. The policy of allowing free negotiation upon such mattersis too strong to warrant the risk of government interference even

"2 See NLRB v. Shannon, 208 F.2d 545 (gth Cir. 1953); Gittlin Bag Co., 95N.L.R.B. II59 (195x), enforcement granted, I96 F.2d 158 (4th Cir. 1952)(per curiam).

63 See NLRB v. Nesen, 2x1 F.2d 559 (gth Cir. 1954) ; L. G. Everist, Inc., Xo3N.L.R.B. 308 (1953); 3. W. Woodruff, Sr., 90 N.L.R.B. 8o8 (I95O), enforcementgranted, 193 F.2d 641 (5th Cir. 1952); Franklin Hosiery Mills, 83 N.L.R.B. 276(I949); cf. NLRB v. Tower Hosiery Mills, Inc., 18o F.2d 701 (4th Cir.), cert.denied, 340 U.S. 811 (1950).

" Reed & Prince Mfg. Co., 96 N.L.R.B. 850, 854 (z95i), enforcement granted,205 F.2d 131 (ist Cir.), cert. denied, 346 U.S. 887 (953). See also Allis-ChalmersMfg. Co., io6 N.L.R.B. 939 (1953), enforcement denied, 213 F.2d 374 (7thCir. 1954).

6 See NLRB v. Lettie Lee, Inc., 14o F.2d 243 (gth Cir. 1944); NLRB v. DixieMotor Coach Corp., 128 F.2d 201 (sth Cir. 1942); Great So. Trucking Co . v.NLRB, 127 F.2d i8o (4 th Cir. 1942).

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HARVARD LAW REVIEWwhen a weak inference might seem justified by experience. Thegrounds fo r drawing an inference of bad faith are much stronger,however, and the argument of policy hardly carries weight whenone is dealing with a stereotyped clause found in almost everycontract. For example, the recognition clause is a standard pro-vision in almost every collective-bargaining agreement. No nor-mal, well-advised employer would boggle over such a clause with-out an ulterior motive. Wlrds' objections to a recognition clausecould be explained upon only two grounds. Its negotiators eitherwere highly peculiar or they were seeking to avoid contractingwith the union. Since Wards proved no peculiarity, the Boarddrew the latter inference.66 In the second Reed & Prince case,67the company insisted on including in the standard recognitionclause proposed by the union the words of the first proviso ofNLRA section 9(a), which reserves the right of an employer tohear individual grievances; but when the union agreed to usethis statutory language upon condition that the second statutoryproviso, which gives the union the right to be present at anyadjustment of grievances, should also be added, the company ob-jected. The Board said, "W e cannot conceive of a good faithbasis fo r a refusal to incorporate a statutory obligation into acontract in the very words of the statute.. This type of quibblingconduct is consistent only with the conclusion that there was bad,not good, faith bargaining." 68Withholding agreement upon trivial matters also casts doubtupon the employer's good faith. In several cases the Board hasplaced reliance upon the company's unwillingness to allow theunion to use the company bulletin board.

We recognize that the Respondent is under no obligation to makeits bulletin boards or plant gates available to the Union for theposting of notices. However, we also recognize that the grantingof such posting permission is a common industrial practice. Ac-cordingly, it seems reasonable to us that the Respondent, if it wasdealing in good faith, would have offered to the Union some sort ofposting facilities. 6966 Montgomery Ward &Co., 37 N.L.R.B. 100, 121 (194), enforcement granted,

133 F.2d 676 (gth Cir. 1943). Reed & Prince Mfg. Co., 96 N.L.R.B. 850 (1951), enforcement granted,2o5 F.2d 13I (ist Cir.), cert. denied, 346 U.S. 887 (1953).6s 96 N.L.R.B. at 855."9 Id. at 854., Compare Montgomery Ward & Co., 90 N.L.R.B. 1244 (195o),

with Frohman Mfg. Co., 107 N.L.R.B. 1308 (1954).

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GOOD-FAITH BARGAININGSuch evidence is rarely used in isolation, but its persuasivenessgrows as the number of issues increases. When the employerengages in protracted discussions on a wide variety of subjectswithout agreeing to any stipulation suggested by the union, theevidence is factually persuasive and its use does not measurablyinterfere with freedom to negotiate. As Judge Magruder phrasedit:

[I]f an employer can find nothing whatever to agree to in anordinary current-day contract submitted to him, or in some of theunion's related minor requests, and if the employer makes not asingle serious proposal meeting the union at least part way, thencertainly the Board must be able to conclude that this is at leastsome evidence of bad faith, that is, of a desire not to reach anagreement with the union. . . . [T]he employer is obliged to makesome reasonable effort in some direction to compose his .differenceswith the union, if 8(a) (5) is to be read as imposing any sub-stantial obligation at all.70

This situation may arise during the negotiation of a first contract.It rarely occurs upon renewal or modification.71The same principle governs evidence of failure to make coun-terproposals. The language of early cases, although not the actualdecisions, seemed to impose a duty to make counterproposals inall negotiations7 2 but today it is clear that the Board may relyupon such evidence only if it shows that with a wide field of bar-gaining open the employer has been unwilling to make someoffer on some subject on which the parties might agree.73 Section

8(d), which was added by the Taft-Hartley amendments, mayhave served as a word of caution, but it did not overrule the doc-trine that proof of a refusal to make counterproposals is admis-sible as evidence of bad faith. 4

7 NLRB v. Reed &Prince Mfg. Co., 205 F.2d X31, 134-35 (ist Cir.), cert. denied,346 U.S. 887 (1953).

" But see, e.g., J. W. Woodruff, Sr., go N.L.R.B. 8o 8 (ig5o).12 See, e.g., NLRB v. George P. Pilling & Son Co., ix9 F.2d 32, 37 (3d Cir.194T).11 Cases holding that failure to make a counterproposal is not evidence ofbad faith because only limited issues were under discussion include Harcourt andCo., 98 N.L.R.B. 89 2 (1952); Collins Baking Co., 90 N.L.R.B. 895 (ig5o),

enforcement granted, 193 F.2d 483 (5th Cir. i951). Cases using failure to makecounterproposals as evidence of bad faith include NLRB v. Reed & Prince Mfg.,Co., 205 F.2d 131 (Ist Cir.), cert. denied, 346 U.S. 887 (1953); NLRB v. O'Keefe &Merritt Mfg. Co., z78 F.2d 44S (gth Cir. 1949); David L Cohen, gi N.L.R.B. 1363(ig5o); N. Ben Weiner, 71 N.L.R.B. 888 (X946)."The provision which became 8(d) originally provided that the duty to

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HARVARD LAW REVIEWThe NLRB also scrutinizes the position taken by an employer

in collective bargaining to the extent necessary to determinewhether it advanced demands so obviously intolerable to theunion as to suggest a purpose to obstruct negotiations. The mostcommon instance is the demand that a union file a performancebond or incorporate or take other steps necessary to subject itselfto suit. Since experience revealed that this demand was fre-quently made by employers who were proved by other evidence tolack good faith, but that it was seldom if ever presented by em-ployers who genuinely accepted the principles of collective bar-gaining, proof that a particular employer made such a demand sus-tained an inference that he was not acting in good faith.75 TheNLRB has also relied upon evidence that an employer refusedto execute a contract unless it reduced the wages then in effect,76curtailed vacations,77 or established wage rates below the ratesoffered to individual employees; 78 but this evidence should besignificant only when there are other indications that the pro-posal did not represent the employer's honest judgment as toproper compensation. Thus limited, these decisions seem cor-rect.

Three items of evidence tending to prove want of good faithhave gradually become per se violations. 9

(i) Refusal to sign a written agreement has always beenregarded as evidence of bad faith.8" Ordinary experience teachesus to be suspicious of anyone who is going through the motionsof negotiating a contract yet evades questions about his will-ingness to reduce to writing any agreement that may be reached.A businessman who enters into negotiations with another com-mercial firm looking towards a complicated transaction but withthe reservation that he will not reduce to writing or sign anybargain in good faith did not impose an obligation to make counterproposals.The wording was changed after the NLRB objected that it would preclude theBoard from considering one of the most important indicia of bad faith. HearingsBefore the Senate Committee on Labor and Public Welfare on S.z126 and S.55,8oth Cong., ist Sess. '914 (1947).

"5 See note 36 supra.76 C & D Coal Co., 93 N.L.R.B. 799 (195).7 NLRB v. Deena Artware, Inc., 198 F.2d 645, 648, 65o (6th Cir. 1952)." Northeastern Indiana Broadcasting Co., 88 N.L.R.B. 1381 (I95O)."At times the Board has treated other conduct, such as demanding a per-

formance bond, as if it were unfair per se . See note 36 supra." See, e.g., NLRB v. Highland Park Mfg. Co., iio F.2d 632, 637-38 (4th

Cir. 1940).

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GOOD-FAITH BARGAININGagreement can hardly be thought to be bargaining in good faith.But in labor relations the writing and joint execution are vastlymore important as a symbol than as a memorial of the bargain.They bear witness to the fact that the terms and conditions ofemployment are fixed not by the employer alone, but jointly byrepresentatives of both the employer and the union. Refusal tosign is a negation of the principle of collective bargaining. It is adenial of joint participation in the culminating act of promulgatingthe wages, hours, and other terms and conditions of employment.This is the true reason, I think, fo r the original decisions holdingthat a refusal to sign a written contract was a per se violation ofsection 8(5) -a judicial doctrine incorporated into section8(d) by the Taft-Hartley amendments. It carries the law beyondthe requirement of formal negotiations and beyond a subjectivetest designed to protect the union against being talked to deathand into an effort to realize at least in part the third purposeof the Wagner Act-a partnership of management and laborin governing the terms and conditions of employment.

(2) Unilateral action yields to much the same analysis. Whentaken during negotiations or upon subjects on which the unionwishes to bargain it weakens the union by showing the employeesthat it is useless to try to negotiate. If the employer unilaterallyraises wages or makes some other concession, his conduct effec-tively tells the employees that without collective bargaining theycan secure advantages as great as, or possibly greater than, thosethe union can secure. Unilateral changes made while the em -ployees' representative is seeking to bargain also interfere withthe normal course of negotiations by weakening the union's bar-gaining position. Consequently, proof that an employer changedwage rates or other terms of employment in the midst of contractnegotiations ordinarily gives rise to the inference that he had nointention of coming to an agreement; 82 the factual inference canbe negated by showing that there was a need for immediate actionor by proving that the negotiations had reached an impasse.

However, a number of decisions, which have not been squarely"See H. J. Heinz Co. v. NLRB, 311 U.S. 514 ('94').82 See NLRB v. National Shoes, Inc., 208 F.2d 688 (2d Cir. 1953); NLRB v.

Barrett Co., 135 F.2d 959 (7th Cir. '943); Stanislaus Implement and HardwareCo., ioi N.L.R.B. 394 (1952), enforcement granted, 226 F.2d 377 (9th Cir. i955) ;J. B. Cook Auto Mach. Co., 84 N.L.R.B. 688 (i949), enforcement granted,184 F.2d 845 (6th Cir. ig5o).

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GOOD-FAITH BARGAININGployment87 Experience shows that the reservation of specificmanagement functions is consistent with the kind of collectivebargaining intended by the NLRA. Experience also shows thatcompanies may not only honestly seek, but often actually nego-tiate, such contracts with labor unions. On the other hand, noemployer ever sought to reserve complete unilateral control un-less he expected the negotiations to fail; and if such a contractwere signed there would have been no joint participation in theterms or conditions of the agreement. When less than completeunilateral control is sought to be reserved, the practical signifi-cance of the point at issue will tend to prove the subjective stateof mind with which the employer is conducting the negotiations,,(3)The cases dealing with the withholding of informationhave an involved history which epitomizes the basic issue con-cerning the meaning of good faith. The earliest cage dealt withfinancial data. 9 When Pioneer Pearl Button Company cut wages,the employees tried' out the new scale fo r a week and then re-quested a revision. The plant manager replied that he could makeno change but would communicate with the home office. The em -ployees struck and during the strike they formed a union. Thecompany's president visited the plant but refused to meet withthe union. The plant reopened five months later but the managerrefused to enter into negotiations saying that "there is no usetrying to bargain with the company, as they would not tie them-selves to union regulation." 10 The plant was closed again pend-ing the president's return. Public officials persuaded him to meetthe union committee, but at the meeting he declared that thecompany "would have nothing to do with the Union" and that"there was no use of trying to attempt to get an agreementsigned . . . ... When the union objected to the wage cut,the president answered that the reason for his refusal to raisewages or reduce hours was the company's poor financial condi-tion, but when the committee questioned the explanation, he de-clined to show its books to the committee or to have them audited.

S'See Majure v. NLRB, x98 F.2d 735 (5th Cir. 1952); NLRB v. Westing-house Air Brake Co., 12o F.2d 1004 (3d Cir. 194)."s or a fuller discussion of this problem see Cox & Dunlop, Regulation ofCollective Bargaining by the National Labor Relations Board, 63 HARv. L. Rnv.389, 418-25 (195o).

8 Pioneer Pearl Button Co., r N.L.R.B. 837 (1936).9od. at 84X.9 Id. t 842.

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HARVARD LAW REVIEWIn holding that the company had violated section 8(s), theBoard commented upon the fact that the company, after stallingfo r months, did no more negotiating than to take refuge in anassertion of poverty which it was unwilling to verify.92 The proofof refusal to supply relevant data probably supported the con-clusion that the company had no intention of signing a contractwith the union upon any terms, but it seems plain that the evi-dence was an unnecessary make-weight. 93

Later cases paved the way for a more stringent rule. In Alumi-num Ore Co., 4 the collective-bargaining representative requestedthe employer to grant a flat wage increase to all the employeesin the bargaining unit. The negotiations were amicable and pro-ductive on other issues, but the employer objected to the flat in-crease on the ground that it would be inequitable to break offthe previous practice of making individual adjustments and togrant workers who had received a recent increase the same raiseas those who had not. After some argument the union acceptedthis position. The employer then declared that it would deter-mine what the individual rates should be, put them into effect andconsider adjustments only when an individual complained; inthis event the employee would be free to press the grievanceeither individually or through his union representative. The em-ployer also refused to furnish the union with a complete wagehistory of the various employees in the bargaining unit. Afterthe usual proceedings the court of appeals sustained an orderfinding that the company had violated section 8(a) (5).

[T]his was not the collective bargaining required by the act. Itwas not the giving and taking in open discussion and negotiationcontemplated by Congress. Rather it was reversion to the procedure9 2 Id. at 843.9 In another early case, The Sherwin-Williams Co., 34 N.L.R.B. 651 (1941),

enforcement granted, 13o F.2d 255 (3d Cir. 1942), the company sought to justifyits refusal to raise wages by referring to a detailed trade-association study of thejob rates paid by other paint manufacturers in the community, but it refusedto allow the union to see the document. There was ample evidence of otherkinds to prove that the company had no intention of allowing the union to par-ticipate in fixing terms and conditions of employment. The Board commentedthat the refusal to produce the data was "inconsistent with the principle ofcollective bargaining which seeks agreement as its end." 34 N.L.R.B. at 667.The statement seems to imply that the employer's conduct in this respect wasevidence of his subjective determination. not to contract with the union uponany terms.

"'Aluminum Ore Co. v. NLRB, 131 F.2d 485 (7th Cir. 1942).

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GOOD-FAITH BARGAININGof the past upon the part of the employer effectuating removal ofbargaining concerning the exact subject matter at issue. . . . Themethod adopted by petitioner ignores this [statutory] standard ofconduct and amounted in its essence to a statement that "we shalldetermine the increases and they will stand as what we are willingto do, subject only to the right of individuals to present griev-ances." 95It is now settled that it is an unfair labor practice for .an em-

ployer to refuse to furnish the bargaining representative withinformation concerning individual earnings,96 job rates and classi-fications, 97 merit increases,9 pension data,99 time-study data,100incentive earnings, 11 piece rates, 1 2 and the operation of the in-centive system. 03 Although many of the cases use the languageof bad faith, proof of the denial of the information is sufficientstanding alone to make out the violation of section 8 (a) (5).

These rulings cannot be explained either as instances of theduty to grant bona fide recognition or as examples of the obliga-tion to treat terms and conditions of employment generally asmatters of joint concern to both the employer and the collectivityof employees. An employer might have recognized a union for adecade and have an earnest desire to make and maintain collec-tive-bargaining agreements yet be unwilling to disclose the man-ner in which merit increases are administered. The difficulty isovercome, however, by recognizing the accepted doctrine thatthe duty to recognize the union's authority and to bargain ingood faith extends to each and every subject falling within thestatutory phrase "wages, hours and terms and conditions of em-

I1d. at 487.o See NLRB v. F. W . Woolworth Co., 352 U.S. 938 (1956) (per curiam),;Boston Herald-Traveler Corp. v. NLRB, 223 F.2d 58 (1st Cir. '955)-, NLRB v.Item Co., 220 F.2d 956 (5th Cir. i955); NLRB v. Whitin Mach. Works, 2,7F.2d 593 (4th Cir. 1954).

" See Taylor Forge & Pipe Works v. NLRB, 234 F.2d 227 (7th Cir. 1956);NLRB v. Boston Herald-Traveler Corp., 21o F.2d 134 (ist Cir. i954).

9 See NLRB v. J. H. Allison & Co., i65 F.2d 766 (6th Cir.), cert. denied,33 5 U.S. 814 (1948).O See Phelps Dodge Copper Products Corp., ioi N.L.R.B. 36o, 366 (1952).

10 See NLRB v. Otis Elevator Co., 208 F.2d 176 (2d Cir. i953).101 See Dixie Mfg. Co., 79 N.L.R.B. 645 (1948), enforcement granted, i8oF.2d 173 (6th Cir. 1950).

102 See Vanette Hosiery Mills, 80 N.L.R.B. i16 (948), enforcement granted,179 F.2d 504 (5th Cir. ig5o).''Dixie Mfg. Co., 79 N.L.R.B. 645 (1948), enforcement granted, i8o F.2d 173(6th Cir. Ig5o).

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HARVARD LAW REVIEWployment." 0 4 In the Aluminum Ore Co. case the employer wasseeking to remove wages from the bargaining table. A unioncannot participate in the award of merit increases to individualemployees whose wage history and rates of pay the employer in-sists upon keeping secret. Nor can there be joint discussion ofjob standards or an incentive system until their method of opera-tion is disclosed. In some of the cases the employer avowedlychallenged the bargainability-of the subject upon which informa-tion was withheld." 5 In others he was obviously seeking to avoidnegotiations upon the issue. 0 6 In virtually all the cases, exceptthose involving financial data, there could be no negotiation onthe subject, in any sense of the term, until the information wassupplied to the union. And since there was no bargaining on astatutory subject the NLRB was not required to review the con-duct of the negotiations. Neither the manner in which the nego-tiations were conducted nor the employer's state of mind was inissue. It was only confusing for the NLRB to treat the issues asproblems of good faith. The cases led directly to a new departurein the interpretation of the duty to bargain.

V.The new ground was broken first in the enforcement of sec-

tions 8(b) (3) and 8(d). The Textile Workers Union of Americaand Personal Products Company had begun negotiating a newcollective-bargaining agreement shortly before the old contractwas to expire. Conferences were held. The parties worked out anumber of points and exchanged proposals and counterproposals;but no agreement was reached. About three months later TWUAbegan to engage in tactics calculated to disrupt the company'sbusiness at a time when the volume of sales was high and a dropof production would sharply curtail profits. Union officials per-suaded employees to refuse to work overtime even though the oldcontract provided premium pay for work in excess of eight hoursdaily or forty hours a week and no one proposed to negotiate anew arrangement. Employees who disregarded the ban werethreatened with physical violence and economic reprisals. TWUAalso sponsored the practice of taking two fifteen-minute rest

10 4 See note 2 supra.'05 See, e.g., NLRB v. J. H. Allison &Co., 165 F.2d 766 (6th Cir.), cerl.denied,

335 U.S. 814 (1948).108 See, e.g., Aluminum Ore Co. v. NLRB, 131 F.2d 485 (7th Cir. 1942).

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GOOD-FAITH BARGAININGperiods on each shift even though the established allowanceswere only ten minutes. When employees were requested to worka special schedule, the union persuaded them to refuse. FromJanuary through March there were deliberate slowdowns in anumber of departments, all sponsored by the union. BetweenJanuary 22 and July io there were twenty-five walkouts fo r theostensible purpose of attending union meetings. Early in Febru-ary when the general manager referred to these disruptive prac-tices and sought to explore the matter with a union official duringcontract negotiations, the latter replied that it was not a propersubject for discussion during a meeting to negotiate the new con-tract and that he should telephone on some other occasion. Therewas no suggestion that the union ever refused to negotiate. Uponthese facts the NLRB unanimously ruled that TWUA had refusedto bargain collectively in good faith in violation of section 8 (b) (3)of the act.

We think it clear that such unprotected harassing tactics werean abuse of the Union's bargaining powers - 'irreconcilablewith the Act's requirement of reasoned discussion in a backgroundof balanced bargaining relations upon which good-faith bargain-ing must rest'- which impaired the process of collective bargain-ing that Congress intended not only to encourage but to protect. 07The Court of Appeals fo r the District of Columbia reversed

the NLRB order on the ground that proof of the harassing tacticswas not evidence of a lack of good faith.There is not the slightest inconsistency between genuine desire tocome to an agreement and use of economic pressure to get the kindof agreement one wants. . . [N]o inference of failure to bar-gain in good faith could have been drawn from a total withholdingof services, during negotiations, in order to put economic pressureon the employer to yield to the Union's demands. As a simplematter of fact . . . no such inference can be drawn from a partialwithholding of services at that time and for that purpose.'08The NLRB has not only refused to accept the court-of-appealsdecision, 09 but it has generalized its ow n ruling to cover other

instances of misconduct. In InternationalUnion, United Mine107Textile Workers (the Personal Products case), io8 N.L.R.B. 743, 746-47

(1954), enforced in part, set aside in part, 227 F.2d 409 (D.C. Cir. 9gss), cert.denied, 352 U.S. 864 (1956).

108227 F.2d at 410.109 See Insurance Agents' Int'l Union (the Prudential Ins. Co. case), rig

N.L.R.B. No. io3 (1957).

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HARVARD LAW REVIEWWorkers (the Boone County case)," the union sponsored astrike over a grievance cognizable under the arbitration clauseof the pertinent collective-bargaining agreement. The strike wasa breach of contract because an undertaking to arbitrate impliesa promise not to strike upon an arbitrable issue."' A strike inbreach of contract is not a concerted activity protected by sec-tion 7. "2 The trial examiner reasoned that since the NLRB's de-cision in the PersonalProducts case must rest on the hypothesisthat all unprotected activities which occur in a bargaining con-text are union unfair labor practices, the United Mine Workershad violated section 8(b) (3).111 The Board approved the deci-sion. 14It seems too plain for argument that unprotected activities inthe course of labor negotiations are insufficient, standing alone,to prove that the union lacks a genuine desire to come to an agree-ment. The NLRB rulings give the duty to bargain collectivelya new meaning. The term "good faith" becomes utterly inappro-priate. The test ceases to be subjective in any true sense. Onecan say that good faith implies a willingness to refrain fromabusing one's bargaining power and to engage in a "reasoneddiscussion in a background of balanced bargaining relations";and then one can infer a lack of good faith, as thus defined, fromthe action which constitutes the abuse or interferes with the dis-cussion. But this is to beat about the bush. The agency's atten-tion is really focused on the particular items of conduct whichare alleged to fall short of accepted bargaining practices. Theshortcomings are per se violations. The NLRB has undertaken toregulate the manner in which collective bargaining is conductedregardless of the actor's state of mind.

Truitt Mfg. Co.,"' which applies the per se doctrine to anemployer, may help to demonstrate the accuracy of these obser-vations. During negotiations upon the reopening of a collective-

21117 N.L.!.B. io95" (1957).1 International Brotherhood of Teamsters v. W. L. Mead, Inc., 230 F.2d 576

(ist Cir.), cert. dismissed, 352 U.S. 802 (i956); see NLRB v. Dorsey Trailers,Inc., 179 F.2d 589 (5th Cir. 1950).

112 See NLRB v. Dorsey Trailers, Inc., i79 F.2d 589 (5th Cir. 195o); JosephDyson &Sons, 72 N.L.R.B. 445 (1947).11a 117 N.L.R.B. at 1120-21.

'1 4 The vote was unanimous except that Member Jenkins did not participate.115IIo N.L.R.B. 856 (I954), enforcement denied, 224 F.2d 869 (4 th Cir. 955),

rev'd, 351 U.S. 149 (xg96).

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GOOD-FAITH BARGAINING

bargaining agreement Truitt offered a two-and-a-half-cents-an-hour increase. The union rejected the proposal in writing, and, as-serting that the company could afford to pay a ten-cents-an-hourgeneral increase, it requested permission to have a certified publicaccountant examine the company's financial records and deter-mine the truth of the assertion that the company was unable tomeet the union's demand. Truitt refused on the ground that"confidential financial information concerning the affairs of thisCompany is not a matter of bargaining or discussing with theUnion." 116 Truitt then went on to argue that its average wagewas already higher than the average wage of competing com-panies. There was further correspondence but neither side sub-stantially changed its position. In the oral discussions the officersreferred to the company's precarious financial condition and saidthat to increase wages ten cents an hour would "break the com-pany." The union struck for five days but the company re-mained firm and the men returned to work. Unfair-labor-prac-tice charges were sustained by the NLRB on the ground that "itis settled law, that when an employer seeks to justify the refusalof a wage increase upon an economic basis . . . good-faith bar-gaining under the Act requires that upon request the employerattempt to substantiate its economic position by reasonableproof." 117 The same principle had been stated in more generalterms in the Annual Report for 1952:

An employer's duty to bargain includes the obligation to furnishthe bargaining representative with sufficient information to enableit to bargain intelligently, to understand and discuss the issuesraised by the employer in opposition to the union's demands, andto administer a contract.118The court of appeals declined to enforce the ensuing order

on the ground that:To bargain in good faith does not mean that the bargainor mustsubstantiate by proof statements made by him in the course of thebargaining. It means merely that he bargain with a sincere desireto reach an agreement. There can be no question but that thecompany here was bargaining in that spirit." 9I1 io N.L.R.B. at 86o.127 Id. at 856.118 17 NLRB ANN. REP. 172 (1953).119 224 F.2d at 874.

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HARVARD LAW REVIEWOn certiorari the Supreme Court sustained the NLRB decision.

Mr. Justice Black, who spoke for the Court, evaded every issue.We agree with the Board that a refusal to substantiate a claim ofinability to pay increased wages may support a finding of a failureto bargain in good faith ... We do not hold, however, that inevery case in which economic inability is raised as an argumentagainst increased wages it automatically follows that the em-ployees are entitled to substantiating evidence. Each case mustturn on its own particular facts. 120The opinion is highly unsatisfactory fo r two reasons. First,

the NLRB had made no factual finding of bad faith. Its opinionreferred to a settled rule of law. Its brief pitched the case uponthe ground that there was a legal duty to supply information rele-vant to the bargaining issues. "Experience demonstrates . . .that production of such data furthers industrial peace and goodfaith negotiations, thereby accomplishing the primary purpose ofthe Act." 121 Neither the brief nor the opinion cited "particularfacts" which made the refusal of information indicative of badfaith in the Truitt case. In the only subsequent case involvingthis problem the NLRB applied the Truitt ruling upon the groundthat the "particular facts" were the same as in the Truitt case,i.e. the employer had pleaded financial inability to grant a wageincrease and then refused to furnish any relevant information. 22Second, mere proof that a company withheld financial data

necessary to examine the plea of poverty does not support afinding that the negotiators lacked subjective good faith. Bothmanagement and union negotiators would be shocked to have theNLRB enforce Mr. Justice Black's statement that "good-faithbargaining necessarily requires that claims made by either bar-gainer should be honest claims," ' 23 but even if this is good law,withholding the information neither shows that the company'sassertions were dishonest nor indicates that it was seeking to evadeagreement with the union. The management might have hadeither motive. It also might have been actuated by fear of im -pairing the company's credit rating if the full extent of its financialembarrassment became known. It might have been reluctant to

120351 U.S. at 153.12' Brief for Appellant, p. 9, NLRB v. Truitt Mfg. Co., 351 U.S. 149 (1956).22 B. L. Montague Co., 1i6 NJL.R.B. 554 (1956).123351 U.S. at 152.

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GOOD-FAITHBARGAININGopen the way to a long argument over balance sheets and incomestatements with union representatives who lacked financial ex-perience. It might have been afraid that the information wouldleak to competitors. It might have had a strong emotional preju-dice for secrecy. With so many explanations available a findingon motivation would be sheer speculation. The Pioneer PearlButton case cited by Justice Black does not remotely suggest thatsuch proof standing alone would be enough to support a findingof bad faith.124

Much more could have been said in support of the NLRBruling if the Court had been willing to face the issue candidly.The earlier strains of thought developing the duty to bargaincollectively point toward requiring financial data but each stopssomewhat short of the conclusion.

The duty to bargain - to meet and treat - was imposed inthe hope that negotiations would lead to the kind of rational ex-change of facts and arguments which increases mutual under-standing and then results in agreement. 2 It is a natural step for-ward to regulate the character of the negotiations so as to in-crease the probability of rational discussion - but it is also astep carrying many implications.

The familiar statement that good faith requires "an open mindand sincere desire to reach an agreement" may easily be takento imply a duty to be willing to conduct the bargaining in sucha way as to increase the likelihood of negotiating a contract with-out resort to economic power. But since the purpose of the testwas different, this interpretation would pour new meaning intothe words. 2 6

The transition from the PioneerPearlButton case to the Truittdecision has analogies throughout legal history. Activities whichoriginally were regarded as some evidence of a fact carrying legalconsequences - in this case bad faith in a truly subjective sense- often come to be sufficient proof standing alone, thus givingrise to new rules of conduct. The process had taken place, albeitfor stronger reasons, in dealing with a refusal to sign a writtencontract, unilateral action, and withholding wage data.' 27 But

'24 See pp. 1425-26 supra.125 See pp. 1408-09 supra.'2 ' See p. 1414 supra." See pp. 1422-28 supra.

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although this is a way in which law grows, use of the techniqueought to depend upon a conscious examination of the underlyingquestions of policy.The Truitt case was distinguishable from most of the prece-

dents upholding the union's right to various kinds of data per-taining to wages and workloads. In those cases there could beno bargaining upon the particular issue unless the informationwere furnished. The most plausible explanation of the employer'sconduct - sometimes the only conceivable explanation - wasthat he was seeking to exclude the collectivity of employees fromeffective participation in determining the matter in question. Anunsupported plea of poverty does not stymie wage negotiations.The union may contend that the company's financial condition isirrelevant, as unions often argue. The discussion may cover com-parison with wage rates paid for similar jobs or by similar com-panies, the trend in wage rates both nationally and locally, changesin productivity, and the rise or decline in the cost of living. 2 ,But despite the narrow ground available the wage-data casescould be, and sometimes were, said to rest upon the broaderproposition that both parties to labor negotiations have an obliga-tion to furnish information necessary to intelligent discussions inwhich there is a willingness to let the ultimate decision turn uponfair consideration of the facts and arguments.

This is the ideal collective bargaining towards which theNational Labor Relations Act was directed. Accurate financialdata is essential to mature collective bargaining. Labor organ-izations maintain research staffs to obtain and evaluate financialinformation in order that they may plan intelligently and adjusttheir demands to realities. Unions may make excessive demandsbased

cox - scope of bargaining

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