THE IMPACT OF UNIONIZATION ON PRODUCTIVITY Appendix This appendix develops a formal model of the conons among wages, worker quality, and estab productivity. We begin with a model in worker quality affects the production process menting the efficiency of the work force. (This model has been used extensively. See Orley felter and George Johnson, "Unionism, Relative Wages and Labor Quality in U.S. Manufacturing Industries." International Economic Review, Vol. 15, No. 3 October 1972), pp. 448–508). In a standard twoingur framework this may be written as: The elasticity of with respect to exogenous changes in w (ie., Y/6) is the key parameter in the system. It determines the extent to which the firm can recover the incremental cost of an exogenous wage increase by hiring workers of higher quality. Stability requires (1/8) < 1, so that wages rise more rapidly than productivity for a given change in M. This makes good intuitive sense, since if it were not true, the firm could lower unit costs by raising the wage. Given stability. the elasticity is bounded by aero and one, since & and Y are both positive. The model can be used to examine the effect of unionimation on labor quality and productivity. Assume that the introduction of collective bargaining raises w by percent. Because of contract rules and associated legal problems the firm cannot adopt the optimal level of M immediately. Until the work force has completely turned over, the firm will have both old (pre-union) and new (post-u2 ion) workers and the new workers will be of higher quality. Let the relative efficiency advantage (L.e., ratio of marginal products) of new workers be given by (1 + k), where (A-12) The production process after unionization can be written where o and n indicate old and new respectively, and the efficiency index has den expressed in terms of the efficiency of old workers. Unionization also has or ganization effects, so that where LLaLo.D=Ln/L, and U takes on a value of one if the observations are drawn from the union era, and aero otherwise. The coefficient on the union dummy captures both organization effects and the influence of quality adjustments. The previous empir ical analysis in this study assumed that AD(1 − B )=0 so that the union coefficient could be identified with the organization effect (d). The magnitude of the bias induced by the assumption is an empirical question and depends on the values attached to labor's share (1-B), the efficiency advantage of new workers (4), and the proportion of new workers in the work force. DISCHARGED EMPLOYEE'S ACTION UNDER FEDERAL The U.S. Court of Appeals for the Fifth Circuit withdraws its Aug. 14 ruling in favor of an employee of a now-defunct oil service company claiming to have been discharged in violation of the Federal Conspiracy to Obstruct Justice Act for filing a personal injury claim against his previous employer. The court agrees to rehear the case, which under a threemember panel ruling would have enabled the employee, Versie Kimble, to proceed with his suit against D. J. McDuffy, Inc. 10-24-80 (DLR) CURRENT DEVELOPMENTS ⚫ (No. 208) A 11 Judge Johnson, who wrote the panel opinion, held that the conspiracy law, a revision of part of the Ku Klux Klan Act, was a valid basis for humble's suit. (1980 DLR 178: A-9). In this class action, Kimble represents all employees discharged on the basis of information their employers obtained from the Industrial Foundation of the South indicating that they had filed personal injury claims against former employers in federal court. Kimble, who was discharged from McDuffy shortly after the company joined the Fundation, had filed suit in federal court against the Noble Drilling Company and recovered $35,000 following an on-the-job shoulder injury he suffered there. The section of the Act which Judge Johnson found to apply to Kimble's action is directed against persons who conspire to "injure a party or witness in his person or property on account of his having . . . attended or testified" in federal court. Judge Johnson adopted a general interpretation of the words "attend or testify" to apply generally to one who avails himself of the judicial system rather than one who has physically testified in a courtroom. In its petition for rehearing, the company criticized the panel majority's construction of this section of the Act, stating that "clearly, Congress could and would have included 'filing' with 'attending' and 'testifying' had it desired to include that act within the statute's protection." The company also argued that, in interpreting Reconstruction Era civil rights legislation, the court was bound to base violations of these statutes only on a finding of "class-based, invidiously discriminatory animus." This requirement, it urged, was specifically found applicable to the clause on which Kimble's action was premised by the U. S. Court of Appeals for the Eighth Circuit in Jones v. United States, 401 F. Supp. 168 (E. D. Ark. 1975), aff'd, 536 F.2d 269 (8th Cir. 1976), cert. denied, 429 U.S. 1039 (1977). Judge Johnson's opinion had found that racial or class-based discriminatory intent must be present only when the relevant statutory provision specifically contains equal protection language. The company also brought to the court's attention in its petition the Seventh Circuit case of Williams v. St. Joseph Hospital (Slip Op. No. 79-1203, July 15, 1950), which upheld dismissal of a claim of conspiracy among physicians in refusing to treat a patient where class-based animus was not present. The en banc hearing without oral argument will be held during the week of January 12, 1981, after both parties have had the opportunity to submit supplemental briefs. (Kimble v. D. J. McDuffy, Inc.; CA 5, No. 78-1474, August 14, 1980) -0 623 FEDERAL REPORTER, 2d SERIES KEY NUMBER SYSTEM Versie KIMBLE, Plaintiff-Appellant, V. D. J. McDUFFY, INC. and Industrial Foundation of the South, and all of its subscribers, Defendants-Appellees. No. 78-1474. United States Court of Appeals, Aug. 14, 1980. Class action was brought on behalf of all individuals who had been denied employment by companies in the oil drilling industry because they had filed workers' compensation or personal injury claims against such companies. The United States District Court for the Eastern District of Louisiana, Alvin B. Rubin, Circuit Judge, 445 F.Supp. 269, rendered summary judgment for the companies and appeal was taken. The Court of Appeals, Sam D. Johnson, Circuit Judge, held that: (1) if the companies refused to hire individuals because they asserted personal injury claims in federal court, the individuals would be entitled to relief under the Federal Conspiracy to Obstruct Justice Act provision barring conspiracies to injure a party or witness in his person or property on account of his having attended or testified in any court of the United States, however (2) the individuals would not be entitled to relief under any other provision of the Act. Affirmed in part, reversed in part, and remanded. For purposes of Federal Conspiracy to Obstruct Justice Act provision barring conspiracies to injure party or witness in his person or property on account of his having attended or testified in any court of the United States, individual is deemed to have "attended" court of the United States from moment that person filed complaint. 42 U.S.C.A. § 1985(2). See publication Words and Phrases for other judicial constructions and definitions. Individuals who alleged that they were unable to obtain employment in oil drilling industry because they filed personal injury 6. Conspiracy claims against companies in that industry were not entitled to relief under the Federal Conspiracy to Obstruct Justice Act provision barring conspiracies to injure a person or his property for lawfully enforcing the right of any person or class of persons to equal protection. 42 U.S.C.A. § 1985(2). 3. Conspiracy -7.6 Individuals who alleged that they were unable to obtain employment in oil drilling industry because they filed personal injury claims against companies in that industry were not entitled to relief under Federal Conspiracy to Obstruct Justice Act provision barring conspiracies to deter parties or witnesses from attending or testifying in any court of the United States. 42 U.S. C.A. § 1985(2). 7.5 There is no requirement that complainant show class-based, invidiously discriminatory animus in order to establish violation of Federal Conspiracy to Obstruct Justice Act provision barring conspiracies to injure party or witness in his person or property on account of his having attended or testified in any court of the United States. 42 U.S.C.A. § 1985(2). 7. Conspiracy 7.5 Within purview of Federal Conspiracy to Obstruct Justice Act provision barring conspiracies to injure party or witness on account of his having attended or testified in any court of the United States, "any court in the United States" does not mean any court physically located in the United States, but rather denotes courts that are part of federal judicial system. 42 U.S.C.A. § 1985(2). See publication Words and Phrases for other judicial constructions and definitions. Lawrence D. Wiedemann, New Orleans, La., for plaintiff-appellant. Phelphs, Dunbar, Marks, Claverie & Sims, Harry S. Redmon, Jr., Rutledge C. Clement, Jr., Margaret Ann Brown, New Orleans, 623 FEDERAL REPORTER, 2d SERIES La., George J. Petrovich, Jr., Fort Worth, federal or state law. Whenever someone Tex., for defendants-appellees. Appeal from the United States District Court for the Eastern District of Louisiana. applies for employment with one of the approximately 300 subscribers to the Foundation's services, the person handling the job application notifies the Foundation and Before TUTTLE, AINSWORTH and provides the Foundation with the prospecSAM D. JOHNSON, Circuit Judges. SAM D. JOHNSON, Circuit Judge: Tales of the violence of white sheeted Southerners prompted Congress to pass the Ku Klux Klan Act of 1871. Today this Court is asked to decide whether one of the offspring of that Act, 42 U.S.C. § 1985(2), provides relief for individuals who allege they are unable to obtain employment in the oil drilling industry because they filed personal injury claims against companies in that industry. The district court, 445 F.Supp. 269, held as a matter of law that the statute does not cover this alleged blacklisting and granted summary judgment for defendants. We affirm in part and reverse in part. I. The Facts The Industrial Foundation of the South (the Foundation) is a non-profit corporation that assists its member companies, all affiliated with the oil industry, in making personnel decisions. Specifically, the Foundation checks court records in Louisiana, Texas, Mississippi, Alabama, Oklahoma, New Mexico, and Missouri to discover all claims filed against companies in the oil industry for injuries resulting from employment. The Foundation then compiles a list of the individuals who have filed suit in federal or state courts, as well as those who have sought workers' compensation pursuant to 1. 42 U.S.C. § 1985(2) is known as the Federal Conspiracy to Obstruct Justice Act. 2. The Foundation hires various individuals to examine the court records: Some of those who examine the records are salaried employees. The majority are district clerks and assistants to district clerks, who are paid a sum of money for each case they report to the Foundation. Deposition of H. J. Robinson at p. 84-86. The propriety of this conduct by federal employees is not before this Court. tive employee's name and social security number.' The Foundation searches through its one-half million records and supplies the requesting company with any pertinent information that it has on the applicant. Using this information as a guideline, the employer then makes an appropriate employment decision. One of the individuals whose record may be found in the Foundation's files is the named plaintiff in this cause of action, Versie Kimble. In 1969, Kimble injured his right shoulder while working for Noble Drilling Company. He filed suit in federal court and, after a jury trial, recovered $35,000. In December 1972, Kimble began working for D. J. McDuffy, Inc. (McDuffy), a now-defunct oil well service company. At the time McDuffy hired Kimble, the company was not a member of the Industrial Foundation of the South. In March 1973 McDuffy joined the Foundation. Shortly thereafter, in early April, McDuffy fired Versie Kimble. McDuffy contended that it terminated Kimble because he was about to seek political office. Kimble claims he was fired because of his prior suit against Noble Drilling Company. On May 13, 1973, Versie Kimble filed this class action on behalf of all individuals who had been denied employment by Foundation members because they had filed workers' compensation or personal injury claims against companies affiliated with the oil 3. The Foundation's records contain more than just a list of the names of individuals who have filed personal injury actions against oil companies. The records include the person's name; the nature of the injury; the amount of money sought; the name of the employee; the name of the insurance company; and the attorneys for both the plaintiff and defendant. 4. The general manager of the Foundation indicated that the Foundation received approximately 92,000 requests per year in 1973. Deposition of H. J. Robinson at p. 82. |