NLRB Orders DuPont to Deal Directly With Union : Labor: Business executives criticize a ruling that the company must disband seven management-worker teams.

WASHINGTON — For the second time in recent months, the National Labor Relations Board has imposed limits on worker-management teams--the collaborative units that have been heralded by some business experts as a way to boost American competitiveness and address pressing workplace issues.

The NLRB ordered DuPont to disband seven teams at its Deepwater, N.J., plant and instead deal with its chemical workers union on workplace concerns.

The decision, issued last week, was hailed by unions but criticized by business executives.

U.S. manufacturing concerns in particular have set up many such committees in recent years to improve product quality and productivity. The collaborative groups at hundreds of companies emulate management-worker teams that operate in Japanese manufacturing plants, where unions are not as influential as their American counterparts.

The ruling by the NLRB--an independent federal agency that acts to prevent employers and unions from engaging in illegal organizing and labor practices--also opposes the philosophy of Labor Secretary Robert Reich, who has been a strong advocate of worker-management teams.

“It’s definitely a setback for the Clinton Administration,” said Richard B. Berman, executive director of the Employment Policies Institute, a Washington-based research organization. “It’s bad for business whenever management has its hands tied dealing with employees without a third party. Management ought to be allowed to deal (directly) with its own employees.”

But Rex Hardesty, a spokesman for the AFL-CIO, countered that the NLRB’s ruling is “a victory for the possibility of real labor-management cooperation and workplace committees, and a defeat for workplace committees that are management-dictated and . . . undercut unions.”

The DuPont case was the first major dispute in which the NLRB addressed the issue of worker-management committees in corporations where a union is present.

Unions have objected to management-sponsored panels on the grounds that they usurp the function of unions. The NLRB agreed with that theory late last year in a case involving Electromation, an Elkhart, Ind., firm. The board ruled that Electromation’s worker-management teams were illegal “sham unions” because they cropped up at a time when the Teamsters were trying to organize the plant.

Similarly, the three active members of the NLRB voted unanimously last week that seven safety and fitness committees at DuPont’s New Jersey plant were illegal labor organization under the National Labor Relations Act of 1935. The agency found that the panels made decisions about safety that were subject to the approval of management.

On Monday, DuPont responded with a statement saying its “committees were in no way, by design or operation, intended to be ‘labor organizations’ or in any way vehicles to undermine the bargaining authority of the union.”

Instead, the Wilmington, Del., firm said, the panels “were simply employee involvement vehicles set up to use the talents and interests of employees in safety and fitness matters.”

Although worker-management committees have been around for nearly a century, they became especially popular about two decades ago, as American consumers began spurning automobiles and electronic equipment in favor of Japanese-produced cars, stereos and video equipment.

According to the General Accounting Office, an arm of Congress, 80% of all Fortune 1,000 companies now use employee involvement in some or all of their operations.

There have been efforts in Congress to pass legislation encouraging more employee-employer cooperation. Political observers say the NLRB--which has two vacancies on its five-member board--might switch positions on the issue once President Clinton appoints additional board members. But labor unions undoubtedly would fight efforts to curtail their already waning clout.