Tuesday, December 14, 2010

7th Circuit Overturns Eastern District of Wisconsin Injunction Against Republic Airways in Union Dispute

The Court of Appeals for the Seventh Circuit issued an opinion, authored by Judge Richard Posner, yesterday addressing what it labeled, "...a novel question under the Railway Labor Act, 45 U.S.C. §§ 151 et seq., which despite its name also governs labor relations in the airline industry."

The problem originated when Republic Airways acquired Frontier Airlines in October of last year. As with every acquisition, a number of changes were made and Republic Airways announced that it was shifting maintenance work on Frontier’s aircraft to Milwaukee—where maintenance is performed by nonunion workers—from Denver, where Frontier’s maintenance workers are represented by the Teamsters Union. Teamsters argued that its collective bargaining agreement with Frontier determines the rights of Frontier mechanics affected by the shift.

Republic Airways disputes Teamsters' position and asserts that the airlines that it owns, although separately incorporated, constitute a “single transportation system” or “single carrier,” within the meaning of the Railway Labor Act. This is significant because if it is held that Republic Airways and all that it owns is a "single carrier," then the Teamsters Union would not represent a majority of its members, and would not be authorized to represent Frontier’s workers.

Prior to reaching the 7th Circuit, the U.S. District Court for the Eastern District of Wisconsin issued a preliminary injunction forbidding Republic from altering pay, work rules, or working conditions until the National Mediation Board rules on the issue of whether Frontier is a single transportation system. The 7th Circuit found a problem with this injunction:
The injunction issued in this case does have a problem, but not a problem having to do with the district court’s authority—rather a problem with how that court has exercised its equitable discretion. The injunction maintains, for the indefinite future (it has no expiration date, and is “preliminary” in name only), what may well be an illegal status quo—a union supported by only a fourth of the bargaining unit yet acting as the bargaining representative of that minority. We are given no reason to think that a majority of Republic’s mechanics want to be represented by the Teamsters Union, and if not they may be placed at a disadvantage if Republic is required to extend special privileges to Frontier’s mechanics.
That is, the District court has placed a union in a workplace outside of federal law governing unionization of an airline. The 7th Circuit held that this "perverse result" can be fixed through "the application of age-old equitable principles" and ruled that the injunction must be modified to condition continuance on the Teamster Union’s prompt application to the National Mediation Board for a ruling on its representation status.

The case is Int’l Brotherhood of Teamsters Airline Division v. Frontier Airlines, Inc., No. 10-2291 (De. 13, 2010).

Enochs Law Firm

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