## Facts

- Great Dane Trailers, Inc. and a union had a collective-bargaining agreement promising vacation benefits based on hours worked, payable near July 1, and providing pro rata vacation pay upon layoff, termination, or quitting.
- After contract expiration and a temporary extension, the union gave strike notice; most employees struck while the company continued operating with nonstrikers, replacements, and some returning strikers.
- During the strike, strikers demanded accrued vacation pay; the company refused, asserting the strike ended contractual obligations under the expired agreement.
- The company announced it would pay vacation benefits (using the prior contract’s formula) only to employees who reported for work on July 1, thereby paying nonstrikers, replacements, and returning strikers, but not strikers who remained out on July 1.
- The NLRB found the policy unlawfully discriminated against strikers in violation of NLRA §§ 8(a)(3) and 8(a)(1) and ordered payment of withheld vacation benefits.
- The Fifth Circuit acknowledged discrimination and potential discouragement of protected activity but denied enforcement for lack of affirmative proof of antiunion motive, despite the employer offering no evidence of legitimate business justification.

## Issues

1. Whether an employer violates NLRA §§ 8(a)(3) and 8(a)(1) by denying accrued vacation benefits to strikers while paying nonstrikers, replacements, and returning strikers, absent direct proof of antiunion motivation.
2. What showing of motive is required under § 8(a)(3) when employer discrimination has a tendency to discourage protected concerted activity.
3. Whether a reviewing court may deny enforcement by hypothesizing lawful motives when the employer has not produced evidence of legitimate and substantial business justifications.

## Decision

- The Supreme Court reversed the Fifth Circuit and directed enforcement of the NLRB’s order.
- Discrimination between strikers and nonstrikers regarding accrued vacation benefits was established and had a tendency to discourage protected activity.
- Because the employer produced no evidence of legitimate and substantial business justification, the Board’s finding of violations of §§ 8(a)(3) and 8(a)(1) was supported by substantial evidence.
- The court of appeals erred by speculating about possible lawful motives to defeat the inference arising from the discriminatory conduct itself.

## Legal Principles

- Discriminatory employer conduct with a tendency to discourage union membership or protected activity may violate NLRA § 8(a)(3) and derivatively § 8(a)(1).
- If discriminatory conduct is “inherently destructive” of important employee rights, the NLRB may find an unfair labor practice without proof of antiunion motivation.
- If the adverse impact on protected rights is “comparatively slight,” antiunion motivation must be shown only when the employer comes forward with evidence of legitimate and substantial business justifications.
- Once discriminatory conduct with potential adverse effects is shown, the employer bears a burden of producing evidence of legitimate and substantial business reasons; absent such evidence, the Board may rely on the discriminatory character and likely effects of the conduct.
- Reviewing courts may not deny enforcement by hypothesizing lawful motives unsupported by the evidentiary record.

## Conclusion

The Court held that Great Dane’s discriminatory denial of accrued vacation benefits to strikers, coupled with payment to nonstrikers and strike replacements, supported an unfair labor practice finding under §§ 8(a)(3) and 8(a)(1) where the employer offered no legitimate business justification, and it required enforcement of the NLRB’s remedial order.


NLRB v. Great Dane Trailers, Inc., 388 U.S. 26 (1967)