## Facts

- Fansteel Metallurgical Corp. operated a manufacturing plant in North Chicago, Illinois.
- Employees organized a union local; the company used a labor spy to gather information and promoted a rival employee organization.
- Management refused to recognize or bargain with the union and opposed proposed contract provisions.
- After repeated refusals to bargain, union members began a sit-down strike and seized and occupied two key plant buildings.
- Fansteel obtained an injunction to vacate; the occupiers remained until law enforcement removed them on a later attempt.
- Many participants were arrested for criminal trespass, and Fansteel discharged those involved in the occupation.
- The NLRB found multiple unfair labor practices, concluded the employer’s conduct helped precipitate the dispute, and ordered (among other relief) reinstatement with back pay for discharged workers.
- The court of appeals declined to enforce the reinstatement remedy for the sit-down strikers; the Supreme Court reviewed the scope of the Board’s remedial authority and related portions of the order.

## Issues

1. Whether the NLRA authorizes the NLRB to order reinstatement (with back pay) of employees discharged for participating in an unlawful sit-down strike involving seizure and occupation of the employer’s property, even if employer unfair labor practices contributed to the dispute.
2. Whether sit-down strikers (and those who aided and abetted the occupation) remain “employees” under NLRA § 2(3) for purposes of reinstatement under § 10(c).
3. Whether a bargaining order requiring recognition of a union as exclusive representative may be enforced when, after valid discharges and new hiring, the union’s majority status is not supported by findings.
4. Whether the Board may require withdrawal of recognition from an employer-assisted, company-dominated labor organization.

## Decision

- The Court held that seizure and forcible retention of an employer’s plant during a sit-down strike is lawful cause for discharge and is not conduct the NLRA protects.
- The Court ruled the NLRB lacked authority under § 10(c) to order reinstatement of employees discharged for that unlawful occupation, notwithstanding prior employer unfair labor practices.
- The Court held employees who aided and abetted the sit-down strike were not entitled to reinstatement on the record presented.
- The Court declined to enforce a bargaining order naming the union as exclusive representative because the Board lacked a basis, after the discharges and replacements, to find current majority support.
- The Court sustained the order requiring Fansteel to withdraw recognition from an employer-dominated organization where substantial evidence showed employer promotion in violation of § 8(2).

## Legal Principles

- The NLRA protects lawful concerted activity; it does not protect unlawful tactics such as seizure and occupation of the employer’s property during a sit-down strike.
- Employees discharged for unlawful sit-down occupations may lose “employee” status for reinstatement purposes under § 2(3).
- Section 10(c)’s authorization of “affirmative action, including reinstatement” does not permit the Board to require reemployment of workers discharged for unlawful conduct.
- Reinstatement may not be ordered for employees who participated in or materially supported an unlawful plant occupation based on the same remedial limits.
- A bargaining order requiring recognition of a particular union as exclusive representative requires findings supporting majority status under the current workforce conditions.
- The Board may order an employer to withdraw recognition from a company-dominated labor organization formed or promoted with employer assistance in violation of § 8(2).

## Conclusion

The Court limited the NLRB’s remedial authority by holding that workers discharged for unlawful sit-down plant seizures cannot be reinstated under the NLRA, and it required current majority support for enforcing a bargaining order, while upholding relief against employer-dominated unions.


NLRB v. Fansteel Metallurgical Corp., 306 U.S. 240 (1939)