State of Minnesota

National Labor Relations Board - Board Decisions

Aug 13, 1975

219 N.L.R.B. 1095 (N.L.R.B. 1975)

STATE OF MINNESOTA 1095
In Re : State of Minnesota , by Warren Spannaus, its
Attorney General, and Charles A. Swanson, Direc-
tor of its Bureau of Mediation Services . Petition To
Cede Jurisdiction- I
August 13, 1975
ORDER DENYING PETITION
BY CHAIRMAN MURPHY AND MEMBERS FANNING,
JENKINS, AND PENELLO
On March 12, 1975, the State of Minnesota
through its Attorney General and its Bureau of Med-
iation Services filed a petition and memorandum in
support thereof with the Board , requesting that the
Board cede to the Minnesota Bureau of Mediation
Services jurisdiction over labor relations in nongov-
ernmental , nonprofit hospitals pursuant to Section
10(a) of the National Labor Relations Act, and that
oral argument be held thereon . On April 18, 1975,
the Board issued an Order Denying Request for Oral
Argument and Notice To Show Cause whether or
not the Board should grant the petition . Thereafter,
responses were received from Minnesota Hospital
Association ; Minnesota Nurses Association ; Hospi-
tal and Nursing Home Employees Union Local 113,
AFL-CIO; American Nurses' Association , support-
ing the petition ;' and from Local 36, International
Union of Operating Engineers ; and Service Employ-
ees International Union, AFL-CIO , opposing the pe-
tition.
The thrust of the petition and accompanying mem-
orandum and of those who support the petition al-
lege, in substance , that the statutory scheme which
until recently governed nongovernmental , nonprofit
hospitals , in Minnesota, including both the Minneso-
ta Labor Relations Act 2 and the Charitable Hospi-
tals Act ,3 was highly successful in accommodating
the interest of hospitals , hospital employees , and hos-
pital patients; that the latter act was passed in 1947
as a result of a series of disruptive hospital strikes;
and that the frequency of such strikes decreased
markedly as a result of the act. The petition concedes
that the Minnesota Charitable Hospitals Act is the
most distinctive aspect of Minnesota law relating to
hospital labor relations in that it prohibits strikes and
lockouts and instead substitutes arbitration as the fi-
nal and binding means of resolving hospital labor
i The views of Senator Walter Mondale , and Representatives Albert Quie,
Bill Frenzel , and Bob Bergland in support of the Petition To Cede Jurisdic-
tion have been received and duly considered in determining the issues pre-
sented herein.
2 Minn . Stat. §§ 179.01-179.17.
3 Minn . Stat . §§179.35-179.39.
disputes .4 It is contended that the Minnesota statuto-
ry scheme has enjoyed success in achieving stable
labor relations in the vital and important hospital
area; that the cession of jurisdiction requested herein
would be in the public interest and of great benefit to
the citizens of Minnesota; and that the Minnesota
Charitable Hospitals Act and other relevant statuto-
ry provisions are, in general, consistent with Federal
policy. Accordingly, it is argued that a cession agree-
ment would not only further the specific purposes of
Federal labor relations policy as set forth in the Na-
tional Labor Relations Act,' but it would also
achieve some degree of state participation in regula-
tion of labor relations, a goal which is clearly desir-
able in our Federal system, as Congress recognized
by enacting Section 10(a) of the National Labor Re-
lations Act. On the other hand, those who oppose the
cession of jurisdiction to the State of Minnesota ar-
gue that there are such substantial departures in the
Minnesota Charitable Hospitals Act from the Na-
tional Labor Relations Act, that this Board cannot
cede jurisdiction under Section 10(a).
The parties concede and it is clear from Section
10(a) of the Act 6 that the Board has the authority to
cede jurisdiction to the agency of any State or territo-
ry unless the provision of the state or territorial stat-
ute is inconsistent with our Act, or has received an
inconsistent construction? The question at issue is
whether the Board has the authority in the circum-
stances herein to cede jurisdiction.'
The petition requests that the Board cede jurisdiction over labor rela-
tions in nongovernmental , nonprofit hospitals . Accordingly, our determina-
tion herein includes consideration of the Minnesota Charitable Hospitals
Act which forms a part of the Minnesota labor statutes.
S Public Law 93-360, effective August 25, 1974. This legislation repeals
the exemption for nonprofit hospitals as formerly found in Sec . 2(2) of the
Act, so that nonprofit hospitals are now within the Act's definition of "em-
ployer" The legislation further amends Sec 2 of the Act by adding Sec.
2(14), which defines a "health care institution" to include "any hospital,
convalescent hospital , health maintenance organization , health clinic, nurs-
ing home, extended care facility, or other institution devoted to the care of
sick, infirm, or aged person ." The legislation thus creates a comprehensive,
new definition of a health care institution , which includes both profit insti-
tutions (which already were under Board jurisdiction before this legislation)
and nonprofit institutions. See 120 Cong. Rec S6930 (daily ed. May 2,
1974): 120 Cong. Rec. S12103 (daily ed. July 10, 1974).
6 See. 10(a) of the Act provides that " [t]he Board is empowered, as herein-
after provided , to prevent any person from engaging in any unfair labor
practice (listed in section 8) affecting commerce . This power shall not be
affected by any other means of adjustment or prevention that has been or
may be established by agreement, law, or otherwise : Provided, the Board is
empowered by agreement with any agency of any State or Territory to cede
to such agency jurisdiction over any cases in any industry (other than min-
ing, manufacturing, communications , and transportation except where pre-
dominantly local in character ) even though such cases may involve labor
disputes affecting commerce , unless the provision of the State of Territorial
statute applicable to the determination of such cases by such agency is
inconsistent with the corresponding provision of this Act or has received a
construction inconsistent therewith."
7 As the Board does not have jurisdiction over state , county, or municipal
hositals, no question of cession arises as to these institutions.
8 PAmalgamated Meat Cutters, and Butcher Workmen of North America,
Local No. 427, A TL v Fairlawn Meats, 353 U.S. 20, 24 (1957). See also 120
Continued
219 NLRB No. 170
1096 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Since 1947, the Minnesota Charitable Hospitals
Act has provided for binding resolution of labor dis-
putes between charitable hospitals and its employees.
The act, inter alia, prohibits strikes 9 or lockouts,10
and makes arbitration mandatory 11 in the event of
impasse . Thus, in order to narrow the scope of the
question before us, we shall first determine whether
these crucial provisions of the Minnesota statute are
of such a substantial departure from the Federal stat-
utory scheme contained in the National Labor Rela-
tions Act, so as to preclude cession.
We shall first turn to that section of the Minnesota
statute, fn. 9, supra, which prohibits both the right to
strike and lockouts. The federally guaranteed right to
strike is so fundamental and basic to the collective-
bargaining process under Federal law, that a prohibi-
tion of that right, such as that in the Minnesota law,
leads us to conclude that such a state law is inconsis-
tent with our Act.'2 The action of Congress, in en-
acting Public Law 93-360, buttresses this conclusion.
Thus, one of the principal changes is the addition to
the Act of Section 8(g) which, in substance, requires
that labor organizations give written notice to a
health care institution and the Federal Mediation
and Conciliation Service at least 10 days "before en-
gaging in any strike, picketing, or other concerted
refusal to work at any health care institution." It is
clear that by the addition of Section 8(g), Congress
intended to preserve a federally guaranteed right to
strike with certain restrictions, and, in preserving this
right, Congress thereby recognized that employees in
the health care industry needed such right to effec-
tively exercise their rights under the National Labor
Relations Act. Although Congress could have pro-
vided other alternatives to the right to strike, for ex-
ample, compulsory arbitration, as Minnesota has
provided, it refrained from doing so. Accordingly, it
is clear, that Congress deliberately enacted Section
8(g) in order to preserve to the employees in the
health care industry the right to strike and, therefore,
it is manifest that the state legislation is in conflict
with Federal law.13
Cong. Rec. 512104-05 (daily ed. July 10, 1974). In determining this ques-
tion, we are mindful of the fact that the language of a state statute and
regulation does not have to be identical to the language of our Act before
cession of junsdiction would be authorized under Sec. 10(a)
9 Minn. Stat. § 179.36.
'o Minn . Stat. ;179.37.
11 Minn Stat.;179.38.
i2 See Secs . 7, 8(axl), 8(b)(IXA), and 13 of the National Labor Relations
Act, as amended . See also Amalgamated Association of Street, Electric Rail-
way & Motor Coach Employees of America v Wisconsin Employment Rela-
tions Board, 340 U.S. 383 (1951).
13 Amalgamated Association v. Wisconsin Employment Relations Board, su-
pra, 340 U.S. at 394 , where the Supreme Court stated ". . . Congress has
closed to state regulation the field of peaceful strikes in industries affecting
commerce ... [a]nd where , as here, the state seeks to deny entirely a feder-
ally guaranteed right . it is manifest that the state legislation is in conflict
As noted above, Section 8(g) is applicable only to a
labor organization's striking, picketing, or concerted
refusal to work at a health care institution. No refer-
ence is made in Section 8(g) to employer lockouts as
was done in Section 8(d) of our Act and in the newly
added Section 213. Health care institutions, as other
employers, are subject to all the provisions of Section
8(d) as modified with respect to notices to the media-
tion services. In developing the law under Section
8(d), the Board and the courts have under certain
circumstances, permitted employers to engage in
lawful lockouts.14 Further, the provision of new Sec-
tion 213 which defines the role of the Federal Media-
tion and Conciliation Service in lockout, as well as
strike situations, similarly contemplates the existence
of lawful lockouts.15 In these circumstances, the Min-
nesota statute prohibiting lockouts at health care in-
stitutions is also inconsistent with the Federal
scheme delineated in our Act.
With respect to that section of the Minnesota stat-
ute, fn. 11, supra, which makes arbitration mandatory
in the event of an impasse in bargaining negotiations,
we again note that Congress refrained from enacting
similar legislation when it had the opportunity to do
so concerning strikes. Under existing Board prece-
dent, deferral to arbitration is deemed appropriate
where the parties have voluntarily agreed to submit
themselves to such arbitration.16 In General Electric
Company v. Callahan," the First Circuit recognized
the underlying theory of Federal legislation with re-
spect to labor relations and quoted the Supreme
Court in N.L.R.B. v. American National Insurance
Co., 343 U.S. 395, 401-402 (1952), as follows:
The National Labor Relations Act is designed
to promote industrial peace by encouraging the
making of voluntary agreements governing rela-
tions between unions and employers. The Act
does not compel any agreement whatsoever be-
tween employees and employers. Nor does the
Act regulate the substantive terms governing
wages, hours and working conditions which are
incorporated in an agreement. The theory of the
with federal law."
14 See, e.g., Local 374, International Brotherhood of Boilermakers, Iron Ship
Builders, Blacksmiths, Forgers and Helpers, AFL-CIO [American Ship Bldg.
Co.] v. N L.R.B., 380 U.S. 300 (1965); N. L. R. B. v. John Brown, et al., d/b/a
Brown Food Stores, 380 U.S. 278 ( 1965); Ottawa Silica Company, 197 NLRB
449 (1972); WGN of Colorado, Inc, 199 NLRB 1053 (1972).
15 See cases cited in fn . 14. Congress did have the lockout issue before it.
See Hearings on S.794 and S . 2292 before the Subcommittee on Labor of the
Senate Committee on Labor and Public Welfare , 93d Cong., 1st Sess. 436
(1973).
16 The question of compulsory arbitration was discussed during the hear-
ings and it was concluded that Minnesota 's "nonprofit hospitals and unions
could negotiate compulsory arbitration in their contracts or anything else
that both parties [could] agree to ." (Emphasis supplied .) See remarks of Rep-
resentatives Ashbrook, Thompson , and Quie in 120 Cong. Rec. H4593 (dai-
ly ed. May 30, 1974). 1
" 294 F.2d 60, 66-67 (C.A. 1, 1961).
STATE OF MINNESOTA 1097
Act is that the making of voluntary labor agree-
ments is encouraged by protecting employees'
rights to organize for collective bargaining and
by imposing on labor and management the mu-
tual obligation to bargain collectively."
The subsequent amendments of the basic Act in 1959
have wrought no change in this policy.19 Thus, the
prohibition of strikes, with reliance upon compulsory
arbitration for ultimate solution of labor disputes, is
a significant restriction upon the free collective-bar-
gaining process as defined by Congress. The national
policy is to encourage voluntary agreements freely
arrived at after "good faith" bargaining between the
parties and not to require compulsory arbitration.
Accordingly, we conclude that there is conflict be-
tween state and Federal policy in this respect, and
that since state action under the Minnesota law
would conflict with the national policy of encourag-
ing free and unfettered collective bargaining, we
should not permit state law to frustrate the national
scheme of our Act by requiring compulsory arbitra-
tion.
As reflected above, we have narrowed the scope of
the question presented to us by determining what, we
believe, are certain crucial differences between the
Minnesota statute and the National Labor Relations
Act, as amended, and the policies underlying them,
and conclude that the provisions discussed above are
a substantial departure from the Federal statutory
scheme contained in the National Labor Relations
Act, and that we must decline to cede jurisdiction to
the State of Minnesota.20
's See also Amalgamated Association v. Wisconsin Employment Relations
Board supra, 340 U.S. at 397.
19 General Electric Company v. Callahan, supra, 294 F.2d at 67.
20 Although the issue of partial cession is not raised in the petition, it is
urged that if the Board concludes that it is unable to cede total jurisdiction
under Sec. 10(a), then it should enter into a partial cession agreement which
would be limited to the Minnesota Charitable Hospitals Act only. It is
proposed that pursuant to a partial cession agreement, unfair labor practice
cases and representation cases would be handled pursuant to the National
Labor Relations Act, and the Minnesota Charitable Hospitals Act would
continue to be utilized as a means of impasse resolution . In view of the fact
that we have found certain sections of the Minnesota Charitable Hospitals
Act to be of such a substantial departure from the Federal statutory scheme
contained in the National Labor Relations Act, we necessarily reject any
alternative partial cession agreement which would be limited to the Minne-
sota Charitable Hospitals Act only. See also In . 21, infra, particularly Sena-
tor Mondale 's proposed amendment to prevent the preemption of the Min-
nesota Charitable Hospitals Act.
Although stability in labor relations has been
achieved under the Minnesota statute in nonprofit
hospitals in the State of Minnesota for over 25 years,
it is clear that the Minnesota law is preempted by
Public Law 93-360. Just as the National Labor Rela-
tions Act itself has been consistently viewed as
preempting existing state laws,21 so, too, would state
labor relations laws concerning health care institu-
tions now covered by the Act be preempted. There is
no doubt that Congress was aware of this and fully
realized that state legislation would have to yield to a
paramount and uniform Federal policy 22 When it
amended the National Labor Relations Act, Public
Law 93-360, Congress was not only cognizant of the
policy questions that have been raised herein, but it
was also well aware of the problems in balancing
state-Federal relationships. Moreover, in reviewing
the legislative history, it is plain that Congress recog-
nized that its labor legislation would preempt the
field that the Act now covers and consciously chose
to embody national standards with respect to feder-
ally protected labor rights.
Accordingly, as we have concluded that the stat-
utes of Minnesota discussed previously are a sub-
stantial departure from the Federal statutory scheme
and are inconsistent with the National Labor Rela-
tions Act, we must deny the petition to cede jurisdic-
tion to the State of Minnesota under Section 10(a) of
the Act.
ORDER
It is hereby ordered that, for the reasons set forth
above, the petition to cede jurisdiction over labor
relations in nongovernmental, nonprofit hospitals to
the Minnesota Bureau of Mediation Services pur-
suant to Section 10(a) of the National Labor Rela-
tions Act be, and it hereby is, denied.
21 See, e.g, Myers v. Bethlehem Shipbuilding Corp., 303 U.S 41 (1938); San
Diego Building Trades Council v. Garman, 359 U S. 236 (1959).
120 Cong. Rec. H4597-99, S6942, S6991, S731I (daily eds. May 2, 7.
and 30, 1974), 120 Cong. Rec. S12104-05 (daily ed. July 10, 1974). The
House, in fact, defeated an amendment offered by Representative Quie, to
insulate state laws such as Minnesota 's from preemption under the NLRA
amendments. 120 Cong. Rec at H4599 (daily ed. May 30, 1974). Similarly,
Senator Mondale, in an effort to save the Minnesota Charitable Hospitals
Act, proposed an amendment for consideration by the full Senate Labor
and Public Welfare Committee to prevent the preemption of the Minnesota
Chartable Hospitals Act. The amendment , however, was defeated . See 120
Cong . Rec S6942, S6991 (daily ed. May 2, 1974).