Airline Labor Disputes and the RLA Status Quo Provisions

by Paul Gatz March 26 2008, 10:34

I. Introduction

On March 7, 2008, the United States Court of Appeals for the Ninth Circuit filed its opinion in the case of International Brotherhood of Teamsters v. North American Airlines. [1] It addressed the question of whether a labor union is entitled to enjoin an air carrier to prevent it from unilaterally altering the working conditions of its pilots, while negotiations for an initial collective bargaining agreement are still pending. [2] The court cited the Supreme Court's interpretation of the status quo provisions of the Railway Labor Act of 1926 in Williams v. Jacksonville Terminal Co., in ruling that unilateral alteration of working conditions are not prohibited in cases where there is no prior collective bargaining agreement, regardless of any pending negotiations. [3] The Teamsters case well illustrates a continuing debate as to whether the Supreme Court's interpretation of the RLA's status quo provisions still adequately serves the RLA's original purpose of promoting peaceable resolution of labor disputes.

II. Background

A. The Railway Labor Act: Purpose & Procedure

In 1926, Congress enacted the RLA, drawing nearly exclusively from the approach to dispute resolution adopted by railway executives and union officials in response to the violent labor conflicts of the late 19th century. [4] Originally applying only to railway companies, Congress amended the RLA in 1936 to include coverage of air carriers. [5] The federal government's interest in the regulation of carrier labor disputes derives from its recognition that interstate commerce relies on the transportation industry and that any disruption of that industry resulting from labor unrest may have devastating effects on both the industry itself and the national economy. [6] The RLA serves to "avoid any interruption to commerce or the operation of any carrier" by providing a procedural framework, within which carriers and their labor unions can peaceably settle labor disputes without disrupting operations. [7] The RLA's status quo provisions, essential to its purpose, "prevent the union from striking and management from doing anything that would justify a strike." [8]

The status quo provisions are scattered throughout the statutory language of the RLA, precluding alterations at specific points during the resolution of major disputes. [9] The general duties of the RLA include the provision that, "No carrier, its officers, or agents shall change the rates of pay, rules or working conditions of its employees, as a class, as embodied in agreements . . . ." [10] In addition, the parties have a duty to "exert every reasonable effort to make and maintain agreements, and to settle all disputes, whether arising out of the application of such agreements or otherwise . . . " [11] This responsibility commences before any agreement has been formed. [12]

B. Status Quo Application and Scope

In the 1942 Williams case, the Supreme Court held that the parts of the RLA prohibiting changes to pay during collective bargaining do not apply to the carrier in cases where there is not a prior collective bargaining agreement. [13] In that case, representatives of red caps employed by a railroad terminal brought action to recover unpaid wages and damages under violations of the Fair Labor Standards Act("FLSA") and RLA. [14] Under the Court's interpretation of the statutory language of the RLA, particularly the phrase "in agreements," the status quo provisions apply only to agreements reached after collective bargaining. [15]

In the 1969 case of Detroit & Toledo Shore Line Railroad Co. v. United Transportation Union, the Supreme Court clarified the scope of the status quo provisions by holding that they concern the preservation of the actual, objective working conditions in effect prior to the time the pending dispute arose - regardless of whether the written agreement touched upon the disputed issue. [16] In justifying its holding, the Court emphasized that the provisions of the RLA form "an integrated, harmonious scheme for preserving the status quo from the beginning of the major dispute through the final 30-day 'cooling-off' period." [17]

C. International Brotherhood of Teamsters

The International Brotherhood of Teamsters ("IBT") alleged that North American Airlines violated its obligations under the status quo provisions of the RLA, by unilaterally altering the pilots' rates of pay, rules, and working conditions, in the midst of negotiations for an initial collective bargaining agreement. [18] The National Mediation Board ("NMB") had certified IBT as the collective bargaining representative for the pilots in January, 2004. [19] In November of that year, North American announced a plan to reduce costs that included pilots' scheduling changes. [20] Negotiations with IBT regarding these changes were not successful, and, pursuant to IBT's application, the NMB instituted mediation proceedings on December 13, 2004. [21] On December 28, 2004, North American announced a reduction in pilots' wages, a reduction of the minimum monthly flight hour guarantee, and other limitations of working conditions. [22] These alterations took effect on January 7, 2005. [23] IBT sought an injunction to prevent North American from unilaterally altering working conditions and to return the conditions to what they were prior to negotiations. [24]

The Court of Appeals applied the rule from Williams, precluding the requirement of maintaining the status quo before the collective bargaining agreement has been completed, thereby denying IBT's request for an injunction. [25]

III. Analysis

Due to the 1978 government deregulation of the airline industry and the financial difficulties resulting from the events of September 11, 2001, the airline industry has become increasingly competitive. [26] Maintaining profitability in this environment has required airlines to increase efficiency and decrease operating costs. [27] This state of affairs leaves workers in a rather precarious position, especially considering the absence of protection for members of new unions that have not yet completed an initial collective bargaining agreement.

The Shore Line Court broadened the interpretation of "agreements" to include common everyday practices that both the union and company recognize as normal during the ordinary course of business. [28] This interpretation, while casting uncertainty over the decision in Williams, stopped short of overruling it. [29] Therefore, where a new union is denied the invocation of the status quo provisions during negotiations for the initial agreement in the face of unilateral changes by the company, the union's only recourse is a strike. [30] Such a situation presents a weak link in the RLA's protection and promotion of peaceable resolution to labor disputes. It has been argued that, because Williams works against the stated purpose of the RLA, it ought to be overruled by the Supreme Court. [31]

IBT raised a number of arguments amounting to the claim that Williams does not apply to the facts of its case. Their first argument cites the statutory language's lack of an express limitation on the applicability of the status quo requirements. [32] Together with Shore Line's vision of an "integrated, harmonious scheme" for the preservation of the status quo from the beginning of the dispute to the end, the lack of express limitation, claims IBT, implies that unilateral changes in working conditions ought to be prohibited even before the completion of an initial collective bargaining agreement. [33]

IBT also cited an interpretation of Williams and Shore Line adopted by the 11th Circuit in International Ass'n of Machinists & Aerospace Workers v. Transportes Aereos Mercantiles Pan Americandos. [34] The argument turns on Shore Line's interpretation of Williams: "In Williams there was absolutely no prior history of any collective bargaining or agreement between the parties on any matter." [35] IBT argues with the 11th Circuit that this statement implies its converse: "Where there is any prior history of collective bargaining, the status quo provisions or RLA must apply." [36]

Finally, IBT compares the language of the RLA concerning the general duty to bargain in good faith to the analogous obligation under the National Labor Relations Act ("NLRA"). [37] As interpreted by the Supreme Court, unilateral changes of working conditions violate the duty to bargain in good faith under the NLRA. [38] IBT argues that the same interpretation ought to be extended to the RLA. [39]

IV. Resolution

The 9th Circuit's response to IBT's arguments maintains that the decision from Williams is still good law and still applies to the facts of IBT's case. [40] The court distinguishes the RLA from the NLRA by noting that, unlike the RLA, the NLRA provides for an administrative agency, clearly demonstrating a disparity of congressional intent regarding their operations. [41]

The 9th Circuit does not address the purpose of the RLA, how that purpose is served by the decisions in Williams and Shore Line, or whether that purpose is served by its own decision in the IBT case. The holding in Williams, that the status quo requirement does not apply in cases where there has been no initial collective bargaining agreement, implies that the interest to be protected by the RLA is the agreement between the parties. This limits that general purpose of "avoiding interruption to commerce or the operation of any carrier" to "avoiding interruption to commerce or the operation of any carrier" in cases where the carrier has already reached an agreement with its labor union. The holding in Shore Line was that the status quo requirement applies to whatever working conditions were in effect prior to the dispute, regardless of their inclusion in any collective bargaining agreement, so long as there is a collective bargaining agreement This holding also implies that the agreement between the parties is the primary interest protected by the RLA - but the focus seems different. It is clear from Shore Line that it is not the terms of the agreement that are important, but rather that there is an agreement.

If the importance lies with the fact of the agreement as opposed to its terms, then the interest of the RLA in the agreement concerns less what is agreed upon by the parties, and more that the parties are in agreement. It is irrelevant, from the perspective of government regulation, what the parties have actually agreed upon. It is essential that the parties can operate in an environment where they can agree on whatever is necessary to continue operations of the industry without the threat of interruption by strike. The interest to be protected by the RLA is the continued operation of the transportation industry; necessary to that continued operation is the ability of the parties to agree. Therefore, the government's interest should be in promoting an environment in which negotiations may be conducted without undue interference. Enforcing agreements is necessary to that interest, but only insofar as it promotes unencumbered negotiations.

V. Conclusion

If the purpose of the RLA is more to promote the avoidance of labor dispute disruption of the transportation industry by providing an environment conducive to negotiation and enforcing collective bargaining agreements, rather than merely enforcing agreements, then IBT's arguments begin to appear far more persuasive. If this is the case, then the only way for the RLA to be able to fully serve its purpose would be for the Supreme Court to overrule Williams.

[1] Int'l Bhd. of Teamsters v. N. Am. Airlines, No. 05-17436, 2008 WL 614243, *1 (9th Cir. Mar. 7, 2008); MetNews Staff Writer, Court: No Status Quo Requirement During Contract Negotiations, METRO. NEWS-ENTERPRISE, Mar. 10, 2008, http://www.metnews.com/articles/2008/team031008.htm.

[2] Int'l Bhd., 2008 WL 614243, at *1

[3] Williams v. Jacksonville Terminal Co., 315 U.S. 386, 402 (1942); Int'l Bhd., 2008 WL 614243 at *6.

[4] Mark A. Schuler, Note, The Railway Labor Act of 1926 and Modern-Day Airline Labor Strife: Progress Toward Labor Peace Begins with Overruling Williams v. Jacksonville Terminal Co., 21 SEATTLE U. L. REV. 189, 192 (1997).

[5] 45 U.S.C. § 181 (2000).

[6] Lisa Catherine Tulk, Comment, The 1926 Railway Labor Act and the Modern American Airline Industry: Changes and "Chaos" Outline the Need for Revised Legislation, 69 J. AIR L. & COM. 615, 615 (2004).

[7] 45 U.S.C. § 152 (2004).

[8] Detroit & Toledo Shore Line R.R. Co. v. United Transp. Union, 396 U.S. 142, 150 (1969).

[9] 45 U.S.C. §§ 155, 156, 160 (2000).

[10] 45 U.S.C. § 152 (2000).

[11] Id.

[12] Int'l Bhd. of Teamsters v. N. Am. Airlines, No. 05-17436, 2008 WL 614243, *4 (9th Cir. Mar. 7, 2008).

[13] Williams v. Jacksonville Terminal Co., 315 U.S. 386, 402 (1942).

[14] Id. at 390.

[15] Id. at 440.

[16] Detroit & Toledo Shore Line R.R. Co. v. United Transp. Union, 396 U.S. 142, 152-53 (1969).

[17] Id. at 152.

[18] Int'l Bhd. of Teamsters v. N. Am. Airlines, No. 05-17436, 2008 WL 614243, *2 (9th Cir. Mar. 7, 2008).

[19] Id. at *1.

[20] Id.

[21] Id.

[22] Id. at *2.

[23] Id.

[24] Id.

[25] Id. at *5.

[26] Tulk, supra note 5, at 628.

[27] Id.

[28] Detroit & Toledo Shore Line R.R. Co. v. United Transp. Union, 396 U.S. 142, 153 (1969).

[29] Schuler, supra note 3, at 204.

[30] Id. at 190.

[31] Id. at 210.

[32] Int'l Bhd. of Teamsters v. N. Am. Airlines, No. 05-17436, 2008 WL 614243, *6 (9th Cir. Mar. 7, 2008).

[33] Id.

[34] Int'l Ass'n of Machinists & Aerospace Workers v. Transportes Aereos Mercantiles Pan Americandos, 924 F.2d 1005, 1008 (11th Cir. 1991).

[35] Detroit & Toledo Shore Line R.R. Co. v. United Transp. Union, 396 U.S. 142, 158 (1969).

[36] Int'l Bhd., 2008 WL 614243, at *6.

[37] Id. at *7.

[38] NLRB v. Katz, 369 U.S. 736, 743 (1962).

[39] Int'l Bhd., 2008 WL 614243, at *7.

[40] Id. at *6.

[41] Id. at *7.

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