agency. It is just a continuing working at those timetables that basically produces the efficiency.

If you say to an office, you have got to handle so many cases and you have to do them within such and such a time and you have every case broken down into individual segments, which we do, we want your investigation completed by such and such a time, we want a complaint issued after that, within such and such a time, and we press our judges and our regions to say, let's get those cases to trial within such and such a time, if those controls work and work well, you get the kind of efficiency that you are talking about.

It is just day-to-day coping with enforcing the targets we set for ourselves.

Mr. FLOOD. All right.

Mr. Michel

Mr. MICHEL. Thank you, Mr. Chairman.

UNFAIR LABOR PRACTICE CASES

You say here there are going to have to be about 1,100 unfair labor practice cases decided and that is an increase, is it not?

Mr. MILLER. Yes; 935 is our projection for this year.

Mr. MICHEL. What categories do these fall in, these unfair labor practices?

Mr. MILLER. Well, roughly two-thirds of those will be unfair labor practice cases against employers, of a variety of sorts, discriminatory discharge, interference with employee rights to organize, refusal to bargain in good faith, firing somebody because he comes to the Board with a problem, those kinds of things.

The other third will be charges against unions, where they have violated what are loosely referred to as the secondary boycott provisions of our act, where there is a charge filed against the union by an individual for failure to represent him fairly; coercion by unions of individual employees, OK-roughly two-thirds against employers, one-third against unions.

Of those two-thirds against employers, again about two-thirds of those, and these are rough figures, but I am not far off, are cases alleging interference with employee rights of one kind or another during organizational campaigns, by and large.

You might have thought by now, after 35 years of the act, we would not have so many of those, but we still do. So that is a very heavy percentage of the work. The rest-we have a full breakdown in our annual reports, but I cannot give you the figures off the top of my head.

That is the general picture.

UNFAIR LABOR PRACTICE PROCEDURES

Mr. MICHEL. What really constitutes an unfair labor practice complaint on the part of an employee? Is all he has to do is just claim that he has been aggrieved in some fashion?

Mr. MILLER. No. sir.

As any of our officers of the day in our regional offices will tell you, many employees are under that impression. They think everybody

for example, if an employer shorts them on a paycheck, that seems to be unfair to them and an unfair labor practice and they come to us and we tell them that does not come under our act. It has to be a violation of the specific rights referred to in the act; the right of freedom to choose or not to choose a union, the right to vote in secret if we have an election, the right not to be discharged either because they choose to engage in union activity or they choose not to. Those kinds of things are some of the examples.

Mr. MICHEL. When you have an investigation of the charges, who does the investigating?

Mr. MILLER. That is done out in our regional offices, principally by our field investigators, so-called-field examiners is the proper title. Mr. MICHEL. Are they full-time investigators for the Board?

Mr. MILLER. For the Board: yes, sir.

Mr. MICHEL. Have you a breakdown of expenditures of labor practice cases? If I singled out a case and I said I want you to tell me how many hours you spent investigating that case, how many manhours, how many dollars it cost, and what your recovery was after all that expenditure, could I get it?

Mr. NASH. I do not believe we have the figures specifically. However, if you would ask about a specific case close enough in time that we could recollect, we could give you a pretty good estimate of the number of hours spent by the investigator, by the attorneys that handled it, in agendas, in regional office clerical time and any meetings of the parties on settlement, and so forth.

If we would get that kind of request on a specific matter within enough time before we forget the time, I think we could give you a pretty accurate estimate.

Mr. MICHEL. I am not so concerned about big business here as I am about the small businessman who feels he gets harassed every once in a while at the NLRB, and he cannot foot the freight like the Government can.

You say, "Well, get yourself a lawyer. You have a good case, you will win."

But he cannot afford the legal fees to go to court. It may be only a couple of hundred bucks. In principle, he thinks he is right.

But the normal procedure, after the filing of one of these unfair labor practices, I guess, is to get the fellow to settle, right?

Mr. NASH. Only after there is an investigation and after determination, there is at least a prima facie meritorious case. As a matter of fact, we find merit in only about 31 to 32 percent of our cases, and only in those cases would there be a settlement approach.

Mr. MICHEL. I am speaking strictly now of unfair labor practices. Mr. NASH. Yes, sir.

Mr. MICHEL. You mean two-thirds of them are thrown out?

Mr. NASH. Without anything being done. After we investigate it, if we find out the facts do not substantiate the claim made, those charges are either dismissed or withdrawn by the charging party when we tell him there is no merit.

After there is a determination of merit the charging party is afforded the opportunity to settle in every case. That is our standard procedure. Mr. MILLER. And a very substantial number are of course settled.

Mr. NASH. Yes. Our settlement rate, particularly over the last 4 months, is running about 90 percent of those meritorious cases.

EXAMPLE OF INDIVIDUAL CASE

Mr. MICHEL. Let me read into the record at this particular point part of a letter that a constituent of mine wrote to the President outlining some of his problems. I will not read it all, but only the more pertinent parts because it involves a relatively small, family owned firm based in Peoria, Ill. They have branches in Stockton, Calif.; Monticello, Wis.; Monaca, Pa.; Newcastle, Dela., and Peru, Ind.

Their total sales are about $13.5 million. Their main products are wire coat hangers for the dry cleaners, and flyswatters. They have been in business since 1917, and it has been in the family since 1930.

On February 1, 1973, they will be completing the final sale and dissolution of their Peru, Ind., operation. It made wire and brass-plated furniture for stamp redemption centers. Sears, and so forth. This operation has had a series of "bad luck." Management was poor at times, the death of key management employees, an 11 months' strike in 1965, and the NLRB, so says my constituent.

He goes on to the President, saying he would like to protest the actions taken by the NLRB in the case yet unsettled.

[Portions of the letter follow:]

I would be wrong to expect you to be familiar with the case known as Laidlaw Corp., Peru, Ind. The NLRB, during President Johnson's term, "set us up" because they needed a new test case concerning the employment of strikers' replacements. The lawyer who helped the NLRB do this and picked us is now employed by our lawyer's firm. Coincidence, but true. You see, we knew it was suicide to stop operations so we worked during the entire 11 month strike. As it turns out, it was suicide-period.

With full legal counsel, we followed "the law," as it was on the books and as interpreted by the NLRB. Though we did, we were found guilty, through the retroactive application of the Fleetwood decision-decided after our strike ended. Mr. President, do you find that hard to believe?

The NLRB also says we are antiunion. As God is my witness, we are not! We have unions in three other plants now. But, Mr. President, the NLRB says we are, so the courts agree. Remarkably, we are because the NLRB says so, not because we are.

We used all our appeal procedures including the Supreme Court who wouldn't hear us.

Well, finally, we settled the strike, without outside pressure. At a meeting with the union and its committee, we were given a list of 23 employees who wanted back to work. We took them back and we settled our strike. The NLRB says no. It says there were 53 employees and the liability of back pay with interest is still ongoing. Union members, when contacted last week, said they agree with our interpretation but, the union and/or the NLRB has told them to discuss it with no one and sign no statements. America? Due process of law? *** I don't think so.

Laidlaw, after $100,000 in legal fees, has sold its business. The NLRB insists we owe $114,000 plus interest. I know of no law we broke. Does anyone care that a small $1,250,000 of sales and 170 employees have no place in the economy anymore? Does anyone care? I think not, but they should.

Where is the fairness for the little, noninfluence bearing company? We're not poor or destitute. We will survive as will others including the NLRB with its penchants for making law.

Mr. MICHEL. Then he goes on with a few other things. That is kind of typical of one particular smaller firm. I suppose I could name several others.

What do you say in response to particularly a charge that he was set up, the firm was set up as a test case?

Mr. MILLER. May we respond briefly to that. I am familiar with that letter because it was referred to me by the President. I replied to it and have had a reply back again from the gentleman who wrote it, in somewhat more cordial terms than at least that first letter.

It is true that in that particular case there was something of a new precedent developed, I think not as new as he suggests. It was a refinement on the Fleetwood case. The Board decided in that case to apply this new precedent to that case at issue.

There was some debate as to whether it should be applied in the future only or to that case. The board decided to apply it to that case. It was appealed to the court of appeals. The court of appeals held that the board had properly interpreted the law and had full authority to make that decision effective in that case and, as he points out, certiorari was sought from the Supreme Court, and the Supreme Court said no.

Mr. MICHEL. Was that a split decision on the Board?

Mr. MILLER. I don't recall. Was Laidlaw a split decision?

Mr. FANNING. No, it was unanimous. It was a hotly contested decision, but the issue you raise as to retroactive applicability was in effect decided by the Supreme Court in the Fleetwood case. That is the controlling precedent. The Board followed the Supreme Court ruling in the Laidlaw case.

Mr. MILLER. The man involved-there may be a change in precedent to his advantage. He is always happy to be there if it is a change to his advantage. I don't mean to be flip about it, but I think it is an inevitable thing that happens in any legal process. It is not unique to the Board. The same things happen in the court as well.

Mr. FANNING. That retroactive applicability was a hotly contested issue. If the Supreme Court had not implicitly ruled on that very point in the earlier case, which was the precedent on which Laidlaw was decided, I wouldn't venture to say how the Board would have decided the issue if it came to the Board as a novel issue. I think what persuaded the Board was the Supreme Court ruling in Fleetwood that the employer there was subject to the Court's interpretation of the law, even though it was a new pronouncement and applied retroactively. [The following was supplied for the record:]

With respect to the application of the principles established in NLRB v. Fleetwood Trailer Co., 389 U.S. 375 (1967), to the Laidlaw case, the arguments and counterarguments are succinctly set forth in the majority and dissenting opinions of the U.S. Court of Appeals for the Seventh Circuit, in Laidlaw Corp. v. NLRB, 414 F. 20 99.

Judge Swigert, for the majority, said: "Laidlaw's final contention relates to the scope of the Board's order. It argues that even if the Board's holding is correct, the imposition of back pay liability is improper because the revised Board policy is being applied to conduct which was lawful at the time the conduct was performed. In support of its position, the company cites section 10(e) of the Administrative Procédure Act which requires the reviewing court to set aside agency action which is arbitrary, capricious, or an abuse of discretion. It also refers us to a number of decisions, including NLRB v. E & B Brewing Co., 276 F. 2d 594, 49 LRRM 3073 (6th Cir. 1960); NLRB v. Guy F. Atkinson Co., 195 F. 2d 141, 29 LRRM 2518' (9th Cir. 1952) and NLRB v. Local 176, United Brotherhood of Carpenters, 276 F. 2d 583, 45 LRRM 3034 (1st Cir. 1960). These cases stand for the proposition that in certain situations the Board's adoption of a new rule or

policy may not be applied retroactively where its practical effect is to create a hardship on the employer disproportionate to the public ends to be accomplished.

"The Board maintains that remedial relief ordered in this case should stand. To justify retroactive relief, it cites the statement of the Supreme Court in SEC v. Chenery Corp., 332 U.S. 194, 203 (1947), to the effect that retroactivity 'must be balanced against the mischief of producing a result which is contrary to a statutory design as to legal and equitable principles.'

"In the case before us, we believe that the importance of protecting the statutory rights of Laidlaw's employees outweighs the fact that the company may have relied on a prior Board rule or policy. We are in agreement with the statement made by the General Counsel in his brief: 'Unless the disadvantaged strikers are compensated, they will have been penalized for exercising statutorily protected rights, and the effect of discouraging future such exercises will not be completely dissipated. In these circumstances, it was not arbitrary or capricious for the Board to conclude that complete vindication of employee rights should take precedence over the employer's reliance on prior Board law.' "The Board's order will be enforced."

In dissent, Judge Major said, inter alia: "With due regard for our limited scope of review, I would deny in toto the Board's request for enforcement of its order. Even if I could agree that the Board's reliance on Fleetwood is proper, I still would refuse enforcement of that portion of its order which awards back pay. I assume, the the Board argues, that it has the power to overrule its previous decisions and 'retroactively to determine the merits of the dispute in which the new policy is announced.' I further assume, as the Board states, that 'there is no absolute rule precluding back pay based upon a retroactive application of a change in the law.'

"The Administrative Procedure Act, title 5 U.S.C.A. sec. 706, which defines our scope of review, provides:

""The reviewing court shall—

66 6

'(2) hold unlawful and set aside agency action, findings, and conclusions found to be

“'(A) arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law;

"The company cites numerous cases in which the courts have refused to enforce the Board's back pay order under circumstances similar to those here. National Labor Relations Board v. Majestic Weaving Co., Inc., 355 F.2d 854, 61 LRRM 2132; National Labor Relations Board v. E & B Brewing Co., Inc., 276 F.2d 594, 45 LRRM 3073; National Labor Relations Board v. Guy F. Atkinson Co. et al., 195 F.2d 141, 29 LRRM 2518; and others. As to these cases, the Board on brief states, 'And while the Company correctly states that there are cases in which this provision (Administrative Procedure Act) has been applied to prohibit the imposition of remedial measures which are not simply prospective in effect where there had been a retroactive change in the law, the Supreme Court has made it clear that each case must turn on its own facts.'

"I shall not repeat in detail the facts material to this point. As previously shown, the company under the advice of knowledgeable counsel scrupulously followed the law as taught by the Labor Board and the courts. This is particularly true as to the law relating to the rights of employer and employees when the latter at the end of a strike make application for reinstatement. The Board tacitly, if not expressly, so concedes. Some 2 years after the events in controversy took place, the Supreme Court rendered its decision in Fleetwood. In reliance on that case the Board announced a change in the law. I think it unconscionable under these circumstances that the company should be saddled with a huge, huge back pay order, and this is so whether the Board's reliance on Fleetwood was proper or not.

"Enforcement of the Board's order means from now on that an employer when faced with the problem of his rights and obligations in a labor dispute cannot safely rely on the advice of counsel, pronouncements of the Labor Board or court decisions for the law by which he should charter his course. Instead, he must be endowed with a power of prophecy sufficiently great to enable him to anticipate that the Board may change the law and make illegal that which was legal.