Metlox Manufacturing Company v. National Labor Relations Board

The Company in this case claimed that it could not give a wage increase or grant other economic benefits to its employees because of financial inability on its part. The Union suggested that the inability to pay might be due to inefficient management, to excessive executive salaries, or to a bleeding of the assets by controlling stockholders. The Company’s reply offered to allow the Union to choose a Certified Public Accountant, subject to the Company’s approval, and to permit him to make an unlimited examination of the Company’s books. The examination was to be made in the Company’s office, with the cost borne by the Union. However, the details of the Company’s financial records were — said the Company — not to be disclosed to the Union or to any third parties. The C.P.A. could only advise the Union whether or not the Company’s profit and loss statements “were true” and perhaps, although the offer was found by the Board not to be clear on this point, whether or not the statements constituted fair representations of the Company’s actual financial position.

The Union was dissatisfied with the amount of disclosure permitted by this offer, and ultimately called a strike. The Board,…

(concurring in part and dissenting in part):

I concur in the majority’s conclusion that the petitioner Metlox did not bargain in good faith when it restricted the Union auditor to a “yes or no” conclusion as to whether the previously submitted profit and loss statements were “true”. I dissent from the enforcement of the Board’s order in its present form.

The parties here are in substantial accord as to the applicable law. NLRB v. Truitt Mfg. Co., 4 Cir., 224 F.2d 869 , stands for the proposition that where an employer claims inability to pay, he may be required to substantiate that claim. The Court in Truitt indicated that whether substantiation was to be required should turn upon the particular facts of each case. The employer here does not resist substantiation here, so we are not faced with determining whether the fact situation would require it absent the employer’s agreement.

The issue is whether the employer may limit the scope of disclosure of the audit consistent with its obligation of good faith in bargaining. I think that it may, and the Board apparently agrees. See White Furniture Co., 161 N.L.R.B. No. 23, 63 L.R.R.M. 1227 (1966). The question then becomes — does the…

378 F.2d 728 METLOX MANUFACTURING COMPANY, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent. No. 20299. United States Court of Appeals Ninth Circuit. Revised May 5, 1967. Frank Simpson, Sheppard, Mullin, Richter & Hampton, Los Angeles, Cal., for petitioner. Arnold Ordman, Gen. Counsel, Dominick L. Manoli, Associate Gen. Counsel, Marcel Mallet-Prevost, Asst. Gen. Counsel, Allison W. Brown, Jr., Warren M. Laddon, Leonard M. Wagman, Attys., N.L.R.B., Washington, D.C., Ralph E. Kennedy, Director, N.L.R.B., Los Angeles, Cal., for respondent. Before WASHINGTON, * BARNES and BROWNING, Circuit Judges. WASHINGTON, Senior Circuit Judge: 1 The Company in this case claimed that it could not give a wage increase or grant other economic benefits to its employees because of financial inability on its part. The Union suggested that the inability to pay might be due to inefficient management, to excessive executive salaries, or to a bleeding of the assets by controlling stockholders. The Company's reply offered to allow the Union to choose a Certified Public Accountant, subject to the Company's approval, and to permit him to make an unlimited examination of the Company's books. The…