In the News: LA Partner Steve Katz talks to SHRM about SCOTUS Review of Strike Damage Claims
Los Angeles partner Steve Katz recently spoke to SHRM's HR News about the U.S. Supreme Court's decision to review Glacier Northwest Inc. v. International Brotherhood of Teamsters.
The National Labor Relations Act pre-empts employer claims against unions under state law, but a narrow exception to this rule exists. The review of this case is expected to clarify whether this exception includes when a strike results in incidental damage to property. If the exception is interpreted this broadly, unions may be held liable for greater amounts when there are such damages during strikes.
In this case, a work stoppage by 16 company truck drivers allegedly resulted in the spoilage of several loads of cement. The employer alleges that the stoppage was timed to intentionally cause damage and harm to the company. The company brought suit against the union in Washington state court for torts related to property damage it suffered due to the work stoppage.
The Glacier Northwest case does not involve any violence or vandalism, said Steven Katz, an attorney with Constangy, Brooks, Smith & Prophete in Los Angeles. Violence or vandalism would clearly be acts of property destruction. "The law clearly permits state law claims for such damage, and no one disputes it," he said.
Instead, this case concerns circumstances where the mere timing of a walkout can cause property damage. "Such cases almost always involve products that can spoil if a walkout is carefully timed, often where the spoilage can damage equipment if it occurs," Katz said. "Employers whose businesses do not involve perishable goods or raw materials in an intermediate state during manufacturing are unlikely to be impacted by the decision, one way or the other."
He said the Washington Supreme Court's decision runs counter to a clear and long-standing consensus on the federal level that strikes and walkouts timed to spoil inventory and inflict collateral property damage on an employer are beyond the protections of the NLRA and may be remedied under state law.
"As an appellate specialist for more than two decades, it is very clear to me that the Supreme Court took up this case to reverse the Washington Supreme Court and restore that consensus. In fact, there is a distinct possibility that the court will reverse in a short unanimous decision—called a per curiam or 'by the court' decision—without oral argument," Katz said.
